Posted by Ken Kurtis on June 11, 2003 at 11:40:26:
I had three or four discussions with folks at PADI thismonring concerning the prfessional liability insurance and then sent this out to our staff regarding the part of the plan where you (the instructor/DM) can save some money by getting a store-based policy instead of an individual one.
If any of you are also considering this, I'm posting this to encourage you to investigate further and make sure you're fully informed should you choose this option. In my opinion, this is not a good move for you as an individual.
Here's what I sent our staff, which I state at the outset is strictly my personal opinion:
"Some of you have asked about the discounted PADI through-the-store insurance. I have had extensive discussions with PADI today about this. Short version - it's a bad deal for you. I strongly encourage you NOT to choose this option. Here's the direct wording off the V&B website:
"Dive professionals are able to secure professional liability coverage under their PADI Dive Center/Resort at reduced prices. Policy limits are $1,000,000 combined single limit per occurrence (per incident - shared between all involved dive professionals and facility) and $1,000,000 annual aggregate. Discount rates computed according to the number of dive professionals insured on each Store/Resort's Instructional policy. Coverage is afforded only while involved in the Store/Resort's teaching and supervisory activities."
Some things to note:
• This would cover you ONLY for teaching Reef Seekers-sanctioned stuff. No privates classes and no Open Boat DMing.
• Not that this is a SHARED policy limit (second sentence). Simply put, it's $1 million for EVERYONE together, not everyone individually, and this includes the additional insureds.
• Put another way, if 3 of the DMs get sued, plus the store and the boat are named, and each are sued for $1 million (total of $5 million if everyone loses), the policy would only pay out a total of $1 million. Anything in excess of that comes out of your pocket.
• It's a $1 million aggregate. So if someone loses a $1 million case in January, that eats up the pool for the rest of the year and there's no coverage left.
• Additionally, since you go through the store to get this, you can be booted off the policy at any time at our sole discretion, leaving you with no coverage. That's too much control to give up to ANY store.
• Although the website touts "up to $199 in savings" that's only if there are 15 or more of you who want to do it this way. The savings can be as low as $135.
• Although Billy and I have not discussed this directly, since it's a pool amount and since the Additional Insureds are part of the pool (under the individual policy, you get $1 million AND we get $1 million in coverage) which means we have much less coverage, especially with multiple defendants named, I'm not so sure we'd be willing to accept this coverage and might require anyone who elects to do this to have some additional coverage that would cover us (the store) in case our losses due to your actions exceed the amount available.
• Again repeating the short version - In my opinion, this is a bad deal."
Ken Kurtis
NAUI Instr. #5936
Co-owner, Reef Seekers Dive Co. (a PADI affiliate)
Beverly Hills, CA