Risk Management — Flying Site Agreements
ACCESS TO and retention of flying sites is a top priority of AMA. Providing the insurance to meet the many and varied requirements of flying site owners is a top priority of the Special Services Department. As many of you know, the ability to provide adequate limits and broad coverage to site owners is often the key to obtaining a flying site.
Most sites require an agreement that may have several requirements regarding insurance and other protection for the site owner and that must be signed by club officers. These agreements are sometimes complex and occasionally include broad language favoring the site owner. While in many cases there is no opportunity to negotiate better terms, sometimes a change of a few words can significantly reduce your contractual liability.
We offer the following comments based on our experience with site-owner agreements and the corresponding coverage provided by the AMA policy.
Key areas of site-use agreements
- Limits of Liability:
- Most agreements require a $1,000,000 limit per occurrence. The AMA policy has a $2,500,000 limit per occurrence and a $5,000,000 annual limit. The limit applies per location (per site). These limits usually far exceed site-owner requirements.
- Primary Coverage:
- Site owners may require that the AMA insurance be "primary," meaning the AMA insurance will cover the site owner without involving the site owner's own insurance coverage. The AMA policy does provide primary coverage to site owners.
- Hold Harmless and/or Indemnity Language:
- This language requires that you "hold harmless" (defend) and "indemnify" (reimburse) the site owner for any claim or suit resulting from site use, including hiring an attorney to defend the site owner if necessary. The AMA policy includes coverage for contractual liability and thus protects the site owner against whom a claim is filed or suit brought for claims resulting from aeromodeling.
Warning: Some site-use agreements contain language to the effect that you (club) agree to defend and hold harmless the site owner for "any and all" claims. While the AMA policy provides very broad coverage, no insurance policy covers "any and all" claims. We suggest you try to negotiate a change in wording from "any and all" to "bodily injury or property damage." The AMA policy insures for claims involving bodily injury or property damage.
- Additional Insured:
- Nearly all site owners want to be listed as an "additional insured" on the AMA policy. To add each site owner to the policy would be cumbersome and time consuming (and nearly impossible). The insurance company has agreed that site owners can be added as an additional insured by issuance of a Certificate of Insurance by AMA naming the site and site owner. Site-owner coverage must be specifically requested by the club in writing. There is a $60 charge to the club for site coverage.
- Separation of Insureds:
- Some agreements require that the policy be written so that any act by the club or a member will not void coverage for the site owner. The AMA policy has a "separation of insureds" clause to provide this coverage.
These are some of the key areas of the site-use agreements we review. There are many variations and occasionally we see new requirements. We are available to review your site-use agreement and offer comments or suggestions on the insurance requirements compared to coverage offered by AMA, indemnity language, and possibly other areas; however, keep in mind we are not attorneys and any contract or agreement should be reviewed by your local attorney. We look at only selected portions of a lease or agreement involving insurance and indemnity provisions. There may be other areas of your agreement equally critical that should be reviewed by your attorney.
Exposures not covered by the AMA policy
- Automobile Liability:
- The AMA policy does not provide automobile liability coverage for members, clubs, site owners, or sponsors. Vehicle owners are expected to have insurance coverage on their vehicles.
- Property (structures or other property):
- The AMA policy does not insure either club-owned property (such as field maintenance equipment or buildings constructed by the club) or site-owner property. If the agreement makes you responsible for property, you will need to make arrangements with your local insurance agent.
- Disputes over Club Policy, Procedures, or Discipline:
- The AMA policy covers "bodily injury (BI) and property damage (PD)." These disputes do not involve either BI or PD and are not insured by the AMA policy. There may be limited coverage under certain circumstances. Contact the Special Services Department for clarification.
In summary, AMA's club-liability policy is tailored to meet or exceed the needs of most site owners. Site-use agreements can be confusing and sometimes may contractually obligate you to more than you expect. The Special Services Department is here to help should you have questions or need more information.
Transcribed from original scans by AI. Minor OCR errors may remain.
