“This is the only insurance product where people root for the event to occur,” added Mr. Gilmartin.

Since 1991, Hole-In-One International has been providing prize coverage for events such as making a hole-in-one on a designated green during a golf tournament. However, the coverage is only part of a national package that sells marketing material and other promotional services for a wide range of events including charities, retail businesses, radio, television, Internet, and other sports promotions.

Nationally, growth has flattened out in the last couple of years, Mr. Gilmartin said, as companies and charities have cut back on their promotions and there has been a less than anticipated growth in the golf market.

Another issue is competition. While there are legitimate players, such as National Hole in One Association in Dallas, there are also those not licensed to sell the product and do. These promoters, by perpetrating fraud, have given the product a black eye, Mr. Gilmartin pointed out. In most of these cases, the promoting company finds an excuse never to pay the claim.

Agents and their clients, in order to avoid such scams, must make sure, as with other insurance products, that hole-in-one coverage is backed by a qualified insurer, explained Mr. Gilmartin. In the case of Hole-In-One, the product is underwritten by Insurance Corporation of Hannover, a subsidiary of HDI U.S. Group, based in Los Angeles and owned by Hannover Reinsurance Co. of Germany.

Reproduced from National Underwriter Property & Casualty/Risk & Benefits Management Edition, August 5, 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.