Amusement Park Insurance

Amusement parks typically need insurance to operate legally, but the specifics depend on your location and attractions.

Here are the insurance policies you likely need to run your business:

• General liability insurance covers accidental bodily injuries and property damage at your amusement park. You might need proof of liability insurance to sign a commercial lease, get a business loan, or get an amusement-specific business license or operating permit in some states. Fairs, malls, and other venues that host your rides may ask to be included in your liability policy as an additional insured.
• Workers' compensation insurance is required in most states, including New York and California, as soon as you hire your first employee. It pays for medical treatment if a worker is injured on the job and provides them with disability benefits while they're recovering.
• Commercial auto insurance covers accidents involving business vehicles. Almost every state requires this coverage for vehicles owned by a business.

Because amusement parks offer a wide range of activities, you may need several permits and associated coverages. For instance, you might need a liquor license and liquor liability insurance if you serve alcohol at your concession stands, or environmental insurance to cover issues related to water use and wastewater at a water park.

Standard insurance policies won't include coverage for high-risk attractions like roller coasters or trampoline parks, or violent acts like assault or molestation. An insurance agent can help you find the coverage you need, which might include excess and surplus lines insurance (E&S) or endorsements for unusual risks.

In addition, consider having guests sign liability waivers. A waiver can't prevent lawsuits related to gross negligence, but it can help you avoid minor liability claims.

Yes, amusement parks may need special event insurance for certain events. General liability insurance covers normal day-to-day operations, but an event that introduces new risks may require additional coverage.

You can purchase one-day event insurance or short-term liability insurance to cover third-party accidents and sign contracts with other parties. For instance, you could buy event insurance for a town carnival or birthday party, or seasonal insurance for a holiday-themed ride at a local mall.

However, there are several reasons to opt for year-round coverage instead:

• It's expensive to stop and start coverage. Businesses that cancel their policies may see increased premiums or have difficulty restarting coverage, as it's a red flag for insurers.
• It may cost more in the long run. Going without insurance leaves you exposed to costly risks. For example, a fire at an amusement park that's closed for the season could destroy valuable rides and other property.
• Some policies won't provide coverage. Occurrence-based policies like general liability continue to cover incidents that happened while you were insured, but that's not the case for claims-made policies like professional liability insurance, which must be kept active to provide protection.

Your amusement rides are your biggest liability, which is why insurance is essential. You also need it to comply with state laws and the terms of contracts.

Here's why you need insurance for your rides:

• It's required by law. Most states require liability insurance for amusement businesses. You'll need to research your state laws to find out how much you're required to carry.
• An accident could bankrupt your business. Amusement rides can be hazardous. The high cost of litigation and healthcare means that even a single accident can have a lasting financial impact or even force your park to close.
• Rides are expensive. Your rides are a significant investment, which is why you should protect them with commercial property insurance and equipment breakdown insurance.
• Insurance demonstrates reliability. Being insured and bonded shows others that your business is reliable and can withstand accidents and lawsuits, which helps attract clients and vendors.

Amusement park owners often invest in the following insurance products to protect against unexpected out-of-pocket costs:

• Business interruption insurance helps your amusement park recover from a forced closure due to a fire or other covered property claim. It's also called business income insurance.
• Inland marine insurance protects items in transit and used off-site, such as an indoor amusement ride that makes an appearance at a mall.
• Product liability insurance covers legal costs if a visitor is harmed by food or merchandise sold at your amusement park, such as contaminated or mislabeled food.
• Liquor liability insurance helps pay for legal fees and damages if a visitor becomes intoxicated at your amusement park and goes on to harm someone or damage their property.
• Crime insurance helps pay for losses from employee theft or fraud, such as theft from a cash register.
• Hired and non-owned auto (HNOA) insurance covers auto accidents involving a personal, rented, or leased vehicle used for business purposes.
• Commercial umbrella insurance, similar to excess liability insurance, provides coverage when your general liability, commercial auto, or employer's liability insurance reaches the limit on a claim.

Our agents can help you find any specialty insurance policies you may need and answer any questions about coverage.

Some of the top factors that affect the cost of amusement park insurance include:

• Types of attractions: High-risk attractions like roller coasters, bumper cars, and water slides will cost more to insure than safer ones.
• Annual revenue: In general, businesses that earn more revenue are associated with costlier claims, which means they pay more for insurance.
• Number of employees: A bigger workforce means an increased risk of accidents and injuries, which raises the cost of general liability, workers' comp, and similar policies.
• Equipment value and condition: The age, condition, and value of your rides and other equipment will determine how much it costs to insure them.
• Location: Localized factors such as crime rate, healthcare costs, foot traffic, risk of natural disasters, and property values can impact your insurance premiums.
• Risk management: Insurance companies may offer lower rates to amusement parks that have well-trained staff, routine maintenance, and strong safety measures.
• Policy limits and deductibles: You can save money on insurance by opting for lower limits or higher deductibles on your policies, but make sure it's enough to cover a potential claim.
• Claims history: An amusement park that has filed insurance claims in the past will cost more to insure than one with a clean claims history.