Decker identifies one social trend as a key driver that is keeping parents spending despite the still-difficult economy: getting their offspring into a competitive college. “People want to get their kids involved at a younger age in sports that colleges see as an extracurricular activity,” Decker says. “There's intense focus on training at younger ages and year-round training. Soccer and baseball are now year-round.”

This push by parents to pad their kids' resumes is one reason “we are seeing growth in [this segment] of the industry,” says Decker, whose company writes sports-league and sports-camp insurance in every state except Louisiana.

Other amateur-athletic areas also seeing nationwide growth are camps for gymnastics and competitive cheerleading. Personal-fitness training, rock climbing and Quidditch [see sidebar] are other burgeoning sports, Decker says.

THE PERILS OF PLAY

The three biggest exposures in the amateur-sports niche are participant injury, spectator injury and sexual abuse or molestation, says Mark Nichols, managing director, Accident and Health Unit, for Markel Corp. of Richmond, Va. Among the many ways a player can get hurt—in addition to the risks inherent to the activity—are negligent coaching or a faulty playing field. Spectators can be injured falling out of bleachers or getting hit with errantly thrown or batted balls. 

And serious injuries aren't just limited to rougher team sports such as football or hockey. “You do run into neck fractures and those types of things with gymnastics,” Pulgine says.

In terms of sexual-abuse and molestation exposure in youth leagues, some states allow hold-harmless waivers, says Nichols, in which the insured have participants sign a waiver releasing the insured of any liability. Not-for-profits, such as governmental agencies or charitable organizations, also may have immunity defenses against claims for sports leagues that are run by municipalities or churches. 

But the potential for abuse claims is always there. “You're going to have a lot of one-on-one exposure between adults and kids,” Decker says, whose Philadelphia Insurance is a longtime writer of abuse & molestation coverage for non-profit social-services entities that include athletics camps. Overall, sports camps and leagues don't have a huge number of injury claims, but when they do, they're large: The sports niche is really a business for catastrophic claims, Pulgine says.

That was devastatingly apparent earlier this month, when a player in the Winslow (Arizona) Little League was fatally injured when he took an inside pitch to the chest as he tried to bunt; the ball hit him just above the heart. Hayden Walton, 13, collapsed at the scene and died in a local hospital the following morning. 

The Winslow Little League did participate in group insurance from Chartis Insurance Group offered through Little League International, says Dan Kirby, director of risk management for the Williamsburg, Pa.-based baseball and softball organization. Covers for membership in Little League International are general liability and accident & medical; the program death benefit is $10,000 and is covered under the accident policy, he says.

About 96 percent of Little League members take advantage of the group program, which can offer substantially lower rates than private insurance. Leagues in the program also receive a D&O policy along with their GL policy, Mr. Kirby says. The limits are a GL minimum requirement of $1 million per occurrence with a $2 million aggregate and a $1 million D&O policy. 

THE PRICING PICTURE 

Rates for GL and participant-accident insurance (PAI) fell along with the economy and have remained flat since, according to Pulgine. “But we don't see it continuing to drop,” he says. Occasionally, a new player will come into the PAI market and look to compete with lower pricing. “There seems to be more interest in that line than any other,” he says.

“Clients are concerned about price, and you have to be on your toes,” he says. 

Decker observes that insurers looking to get into the sports field may do so without knowing the business—and so may not be charging enough per participant. 

For its part, Philadelphia Insurance provides coverage for some 3,000 athletic leagues and camps across the nation, with premiums averaging about $5,000; smaller camps and clinics pay $1,000 or less. 

AMATEUR NICHE—FOR PROS ONLY

Sports insurance can be profitable for insurers who know the field, even in a year where the P&C market has already suffered tremendous cat losses, says Decker.

But while there's money to be made in sports camps and amateur sports leagues, success in this niche requires specialization—those diving in with little or no experience may find themselves in over their heads.

“You have to know what you're doing. There are little nuances to everything,”  says Pulgine, whose MIC sells two main lines of insurance—GL and PAI—to clientele such as youth baseball and sports camps for gymnastics and cheerleading. It also sells package and umbrella policies for accounts that might need additional cover, like a marine or equine policy. MIC is licensed in all 50 states and has some 2,500 sports clients countrywide.

Markel's Nichols agrees that this product type requires a specialized knowledge—and tends to attract a certain type of agent or broker.  

“The people who typically specialize in it are generally athletes themselves—guys who have been [involved] in sports,” says Nichols, whose company has been writing GL and PAI cover for amateur sports nationwide since 1995.