Worsening insurance crisis

[GiraffeMarineSalvage]

Instructors being dramatically underpaid relative to the liabilities they are taking is also compounded by "common sense" no longer being "common" anymore...
Plus an individual instructor whose student has an accident may or may not genuinely be at fault but they are likely to be scapegoated and the current american legal system is unlikely to achieve anything close to a fair and timely outcome, let alone genuine justice.
Two notable examples of the degree of problems in the legal system include Raied Alfouadi v. Wong et al( Hawai'i District Court case #1:2012cv00057) when a guy that used his foot like a fender pulled off getting a settlement from the boat owner (it sounded like the boat owner did make noteworthy errors but the actual injury was purely the litigious guy choosing to stick his foot between two boats ) and even worse there's a case in which criminal charges were filled against a lifeguard that successfully saved a kid's life... (Connecticut Lifeguard Charged With Endangerment After Saving Boy From Near-Drowning ).

 

[Zef]

What about the dive industry adopting the "insurance club" model similar to the large vessel shipping industry?

-Z

 

[Wookie]

My feelings about insurance is that individual instructor insurance protects the agency and shop, and not the instructor.

Let me explain.

The vast majority of dive guides/dive instructors who do this for a living don’t have a pot to piss in. Especially the ones in a resort setting either in the USA or outside the USA, so what is their million dollar policy buying? A deep pocket to protect a bigger fish somewhere upstream. That big fish, BTW, is the entity that dictates that you have insurance or they won’t issue a card. So a majority of instructors have nothing to protect, but have to carry insurance to protect their agency. Same agency that provides a partnership with the insurance agent in many cases.

But some instructors do have assets to protect. They need liability insurance, just like a real estate agent needs an errors and omissions policy, or a contractor needs a general liability policy. But a contractor or real estate agent spend hundreds of hours in apprenticeship before they get a state issued license. And if they screw up, you buy a house with termites or windows installed upside down. Your dive instructor, after running through the 10 day instructor mill, or worse, zero to hero VA sponsored rebreather instructor course, can set conditions that lead to your untimely demise, but the instructor mill and agency are protected by your million dollar policy.

As is the instructor. Their million in assets is protected. I know a lot of dive instructors. I even know a few with a million in assets. A difference is that they are consummate professionals in the aspect of their life that made them a millionaire, and also in the part of their life that makes them a dive instructor. I know lots of dive instructors that I wouldn’t allow anywhere near a loved one. Those are the ones that insurance protects. The crappy instructors and the training agency.

Maybe it’s time for a reset. My commercial general liability policy cost about $5000 the last year I held it. Maybe it’s time to weed out the crappy instructors.

 

[adurso]

Well, a reduction in instructors could lead to an absence of instructors and a final collapse. In a sport such as scuba, instructors are mandatory, certifications are by in large mandatory to take part in the sport in any capacity. For all practical purposes no new certified divers means the eventual death of scuba diving. No new certified divers means no new gear sales means a catastrophic industry collapse.
A total catch 22, instructor pay decreasing to the point they can’t do it compounded by soaring insurance costs compounded by less money available for people to spend to enter the sport and we have have a perfect storm.

Would not this lead to people diving the way we did it when I started, meaning reading a book, or someone telling one:” never hold your breath, if your ears hurt on the way down, pinch and blow, never come up faster than your slowest bubble, and never hold your breath”?

 

[kensuf]

My feelings about insurance is that individual instructor insurance protects the agency and shop, and not the instructor.

Let me explain.

The vast majority of dive guides/dive instructors who do this for a living don’t have a pot to piss in. Especially the ones in a resort setting either in the USA or outside the USA, so what is their million dollar policy buying? A deep pocket to protect a bigger fish somewhere upstream. That big fish, BTW, is the entity that dictates that you have insurance or they won’t issue a card. So a majority of instructors have nothing to protect, but have to carry insurance to protect their agency. Same agency that provides a partnership with the insurance agent in many cases.

But some instructors do have assets to protect. They need liability insurance, just like a real estate agent needs an errors and omissions policy, or a contractor needs a general liability policy. But a contractor or real estate agent spend hundreds of hours in apprenticeship before they get a state issued license. And if they screw up, you buy a house with termites or windows installed upside down. Your dive instructor, after running through the 10 day instructor mill, or worse, zero to hero VA sponsored rebreather instructor course, can set conditions that lead to your untimely demise, but the instructor mill and agency are protected by your million dollar policy.

As is the instructor. Their million in assets is protected. I know a lot of dive instructors. I even know a few with a million in assets. A difference is that they are consummate professionals in the aspect of their life that made them a millionaire, and also in the part of their life that makes them a dive instructor. I know lots of dive instructors that I wouldn’t allow anywhere near a loved one. Those are the ones that insurance protects. The crappy instructors and the training agency.

Maybe it’s time for a reset. My commercial general liability policy cost about $5000 the last year I held it. Maybe it’s time to weed out the crappy instructors.

It's going to be an interesting ride. I've had more than one part timer, that was (in my opinion) a solid instructor that has recently told me something along the lines of "if I took the money I'm spending on insurance and put it into an investment account, I would be in really good financial shape in 20 years."

 

[Zef]

...But some instructors do have assets to protect. They need liability insurance, just like a real estate agent needs an errors and omissions policy, or a contractor needs a general liability policy. But a contractor or real estate agent spend hundreds of hours in apprenticeship before they get a state issued license....

For what its worth...anyone who is working as an instructor (at least in the USA) and has not set themself up as an LLC, is both a dive instructor and a fool. The fact that one needs to have professional liability insurance to work as an instructor, constitutes the need to sever one's assets from their professional diving endeavor. The same is true for those working as assistant instructors and divemasters. To not protect oneself and their assets by establishing an LLC (or a corporation) one is waiving a flag as a target for those litigiously minded, especially if their insurance doesn't pay out.

-Z

 

[tursiops]

For what its worth...anyone who is working as an instructor (at least in the USA) and has not set themself up as an LLC, is both a dive instructor and a fool. The fact that one needs to have professional liability insurance to work as an instructor, constitutes the need to sever one's assets from their professional diving endeavor.

-Z

^^^THIS^^^
It costs maybe $100 and a few minutes, using LegalZoom, to set up your LLC.

 

[Subfiend]

My feelings about insurance is that individual instructor insurance protects the agency and shop, and not the instructor.

Let me explain.

The vast majority of dive guides/dive instructors who do this for a living don’t have a pot to piss in. Especially the ones in a resort setting either in the USA or outside the USA, so what is their million dollar policy buying? A deep pocket to protect a bigger fish somewhere upstream. That big fish, BTW, is the entity that dictates that you have insurance or they won’t issue a card. So a majority of instructors have nothing to protect, but have to carry insurance to protect their agency. Same agency that provides a partnership with the insurance agent in many cases.

But some instructors do have assets to protect. They need liability insurance, just like a real estate agent needs an errors and omissions policy, or a contractor needs a general liability policy. But a contractor or real estate agent spend hundreds of hours in apprenticeship before they get a state issued license. And if they screw up, you buy a house with termites or windows installed upside down. Your dive instructor, after running through the 10 day instructor mill, or worse, zero to hero VA sponsored rebreather instructor course, can set conditions that lead to your untimely demise, but the instructor mill and agency are protected by your million dollar policy.

As is the instructor. Their million in assets is protected. I know a lot of dive instructors. I even know a few with a million in assets. A difference is that they are consummate professionals in the aspect of their life that made them a millionaire, and also in the part of their life that makes them a dive instructor. I know lots of dive instructors that I wouldn’t allow anywhere near a loved one. Those are the ones that insurance protects. The crappy instructors and the training agency.

Maybe it’s time for a reset. My commercial general liability policy cost about $5000 the last year I held it. Maybe it’s time to weed out the crappy instructors.

I agree with Wookie. If you want to educate yourself further, read up on the four main types of risk management strategies:

• Risk acceptance.
• Risk transference.
• Risk avoidance.
• Risk reduction.

Which method does your preferred training agency follow? If it’s risk transference, the method used by the agency most commonly mentioned in SB threads and a few others, that means the agency transfers the risk of loss onto the instructor or shop with various tools, like their non-agency agreement. It’s first ring of protection around the castle is achieved by placing the instructor or the shop between it and the attacker.

This isn’t rocket science. It’s a legitimate method of risk management. However, if you are not inside the castle, you have to ask yourself if you really want to be the conscript outside the castle wall, in front of the moat. If not, then align yourself with an agency that practices risk avoidance, reduction or acceptance.

 

[kensuf]

^^^THIS^^^
It costs maybe $100 and a few minutes, using LegalZoom, to set up your LLC.

I'm not a lawyer, I didn't sleep in a holiday inn express last night either. But a 30 second google search shows that an LLC won't necessarily protect you from your own negligent acts.

LLCs and Limited Liability Protection

Find out what type of limited liability protection you and your business get from an LLC.

www.nolo.com

 

[Subfiend]

I'm not a lawyer, I didn't sleep in a holiday inn express last night either. But a 30 second google search shows that an LLC won't necessarily protect you from your own negligent acts.

LLCs and Limited Liability Protection

Find out what type of limited liability protection you and your business get from an LLC.

www.nolo.com

Gull Dive Center was a LLC. Just sayin…