Range insurance rates jacked up


Nathaniel Firethorn
January 2, 2003, 01:05 PM
One of the owners of the range where I shoot told me that their insurance rates were just raised by $18,000 per year! :what: :mad: He's never had an accident at the range in prolly twenty years of operation.

Any idea what the excuse is this time? And is this going on all over, or is it just a local thing?

- pdmoderator

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January 2, 2003, 01:32 PM
My club had to rise the yearly fees because of raised insurance premiums. I'll try to find out how the insurance company excuses the raise.

January 2, 2003, 01:44 PM
Back door gun control!! Next it will be that you can't buy a gun without "proof of insurance"!!:cuss:

January 2, 2003, 01:48 PM
Stock market returns this past year were not up to par. So to cover themselves no doubt rate increases are in order.

Second and more significantly, litigation attorneys at the behest of their political and ideological handlers have drawn a bead on the gun industry. It started (they say) with lawsuits to cover the medical costs of gun injuries (c.f. tobacco) then moved afield in several different new and innovative directions. Bottom line, the gun industry is targeted by the same people who targeted tobacco, Microsoft, big fatfood, medicine, asbestos users, ad nauseum.

The '04 presidential election will turn on
1>war on Islamofascist terrorists,
2>Immigration control (or the lack thereof), and
3>tort reform (someone's gotta throw a blanket over these people).

January 2, 2003, 03:22 PM
We are way overdue for tort reforms, but those who make the laws are what? LAWYERS!!!!! I think many people would like to see tort reform, but attorneys are not among those who are pushing for reforms because they are making money on frivolous law suites.

January 2, 2003, 04:43 PM
I have never made any money off of a law suite.

If you want tort reform you'd better demand a premium refund while you are at it. After all, if the exposure from lawsuits is reduced, shouldn't you enjoy a roll-back on your insurance expenses, irrespective of how your insurer's portfolio performed in a given year?:scrutiny:

January 3, 2003, 08:13 AM
if the attachments work...
should be a sample rate page from a company that is no longer in business.

January 3, 2003, 08:30 AM
the rates shown in the above attachment are for liability only. i've never seen any rate pages for property. but a short sample rating of a building insured for $100,000 and contents of $50,000 for a company with Loss Cost Multipliers of 1.678 (that means they charge about 68% more than nation wide rates set up by a government agency) generated a premium of $470 for the building and $409 for the contents.

granted, many companies prohibit writing such business, as they are viewed as 'high risk'.

take for example, the liability page above. suppose a range with no previous claims has a death or just an injury. with a $1,000,000 liability limit it might only take the one loss to reach the aggregate limit of one million.
therefore, a smart range would either seek higher limits on the liability policy, or obtain an Umbrella policy to extend the limits to five million, ten million, whatever they are willing to pay for.
that umbrella policy typically is rated by taking a percentage of the premium paid for the liability policy, for example, 25% would be a decent estimate for this hazard grade for gun ranges; lets use an underlying liability premium of $2500. the first layer of the umbrella would be $625, but there usually is a minimum premium of $750 for the first layer, and then the minimums for the next layers are like $500 or so.
so a five million umbrella policy might run a few thousand dollars.

not to mention that it is highly unlikely for a company to write such a business at base rates. they surely would attach maximum debits, any where from 25% to sometimes 80%.

now when you figure that a company may already increase their base rates by 30 to 60 and sometimes 120% over what the national rates are, and then tacks on maximum debits, insureds can sometimes wind up paying 200% more than what the government agencies like ISO setup.

insurance is highly lucrative.

attached is the underwriting guidelines to go with the above attached rates.

Master Blaster
January 3, 2003, 12:05 PM
Have the range owner call the NRA they have range operators insurance programs. My club buys their insurance from the NRA approved/endorsed provider.

Insurers are businesses like any other.

In the consumer end of the market, the rates are highly regulated, and must be filed and approved by the insurance commissioner of the state where the policy is issued, this rate must be backed up by an actuarial study of the actual loss experience for the line of business involved.
State regulators will not allow a gross underwriting profit in any state I have ever been involved with.

Commercial lines of business which would include the liabaility on a firing range, are less regulated, but if the company is admitted they still must file a rate plan based on experience and get it approved.

Competition between companies usually keeps rates under control as well, but not many companies write range operators liability. The bottom line is shop around rates can vary widely by carrier.

ISO = Insurance Services Office, an association of Insurers, not a government agency, for a fee ISO provides approved policy forms, and rate filing plans to member companies. ISO was founded to help cut the costs of filing rate plans and forms in 50 different states. Members use what ISO has developed to avoid having their own staff to do this, it lowers the cost of operations for member companies.

Call the NRA for all your firearms related insurance.:D

January 3, 2003, 12:18 PM
okay, ISO isnt really a govt agency, but companies that use ISO rates are using the rates that apply across the country, or was i told incorrectly? when i studied for my MGA license (okay, the phrase 'study' is quite a stretch to describe what i did before taking the test) the workbooks indicated (or i interpreted them as such) that average rates are developed by actuaries who study loss data and determine what the rates should be for a company to at least break even.
and the loss cost multipliers a company files on top of ISO rates reflect their loss history and help them turn a profit, correct?

i push the paper here but i sure dont know much about the boring details. :D

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