[UPDATE: The USHPA has reached its goal of raising $2,000,000 to become self insured.]
As of March 1, 2016, the United States Hang Gliding and Paragliding Association (USHPA) is losing its standard insurance coverage due to unaffordable premiums.
According to experts from USHPA, there are several factors that are driving premiums up to an unmanageable level. Serious accidents caused significant property damage and severe injury to spectators; students incurred injuries in training and took instructors to court, despite having signed waivers; and the way that the insurers file and settle claims has a negative impact on cost control.
Going without insurance is not an option. Aviation-based sports are often singled out from other adventure sports and both insurers and site owners view them as extremely high risk. Without coverage, land owners will be very reluctant to open sites for training and competitions. Individual pilots and instructors may become personally liable for damage or injury, which is a level of unsustainable exposure. USHPA currently insures about 200 sites, and insurance coverage is a necessity for those to remain open.
So, how to get insurance when commercial premiums are out of reach? USHPA’s answer is to create a risk retention group (RRG).
A RRG is a corporation created specifically to provide self-insurance. When licensed in one state, federal laws permit the RRG to function in all 50 states. As in any corporation, shareholders will select a board of directors, and the board will oversee and manage the claims process, premiums, re-investment of capital, and other matters.
For USHPA members, the prospect of the RRG is good news! Once the RRG capital investment goal is reached and the corporation forms, USHPA members will start to see benefits. In addition to retention of site access, expect to see stabilized premiums, faster claim settlements, and reduced expenses and dues.