LIABILITY INSURANCE
Critical for Personal Trainers
Carrying appropriate and sufficient liability insurance is vitally important for Personal Trainers because they are at risk for liability claims every day. Personal trainers are liable not only for their own actions while training their clients but also for what they say or don’t say when instructing their clients. Clients can claim that they were not properly instructed in how to use a piece of equipment or how to perform a specific exercise or stretching activity. Trainers are also liable for the nutritional or health advice and recommendations that they provide to their clients. Injury or illness resulting from any of these aspects of their work can lead to a claim or law suit for a personal trainer.
Liability claims are both common and very costly. Medical bills have increased significantly over the past decade. Even minor injuries such a sprained ankle can cost several thousand dollars due to the cost of MRIs and physical therapy. A torn ACL or rotator cuff can cost tens of thousands of dollars when surgery is required. A full knee replacement can cost more than a $100,000 including the surgery, rehabilitation and loss of work. A serious or life threatening injury or illness can turn into a $1,000,000 claim if the claimant or their heirs file a law suit for damages. All of these costs can easily put most personal trainers out of business and potentially in danger of losing everything they own.
The scary fact is that Fitness Insurance Programs have found that personal trainers are far more likely to allow their insurance to lapse than fitness facilities. Insurance is not just a hiring requirement that a personal trainer needs to purchase one time to start work at a health club or studio. All personal trainers, both full-time and part-time, need to carry liability insurance at all times with no lapses in coverage.
What types of claims are personal trainers at risk for today?
Personal trainers are primarily liable for their own professional liability. That means their own services as a fitness professional, rather than the premises liability of the facility where they train. Professional liability claims today can come from the fitness professional’s actions, instruction, fitness and nutritional counseling and coaching, or a lack of any one of these plus a number of other exposures including personal injury, cyber liability and sexual abuse. An injured party can claim bodily injury, personal injury or sexual abuse.
Bodily injury can be a physical injury or physical illness and can include medical bills, loss of work and/or pain and suffering. These are the most frequent liability claims in Fitness Insurance Programs.
Personal injury includes claims of libel, slander and wrongful invasion of privacy. Libel is defined as defamation by written or printed words or images including electronic media. Slander is defined as defamation by spoken word. Invasion of Privacy involves the violation of a person’s right to be left alone. This may include harassment or the improper sharing of client information.
Cyber Liability is a term used for the liability of using electronic media in advertising and promotions that can result in libel or invasion of privacy claims. This can include the unauthorized use of a client’s name or photo on either a website or social media. With the huge growth of all forms of social media in the advertising and promotion for personal training businesses, this exposure produces the most questions today from both fitness professionals and fitness facilities.
Advertising Liability claims can arise out of misappropriation of advertising ideas, such as the infringement of copyright on established brands, titles or slogans committed in the course of advertising your services. This type of liability has increased with social media posts and use of copyrighted material pulled from the internet.
The potential of a claim for Sexual Abuse is another serious exposure for personal trainers. A client can misinterpret actions or words and claim sexual misconduct or slander with the personal trainer having no idea what they did or said to offend the client. These types of claims can be expensive to fight.
If a personal trainer is selling any products, such as nutritional supplements, then they have an exposure for Product Liability.
What are the most common claims involving personal trainers?
The most common claim is a failure to instruct. This occurs when a client claims that their personal trainer did not tell them how to do an exercise properly resulting in an injury.
The second most common and usually far more costly claims occur when a client suffers a serious injury or illness as a result of a preexisting injury or condition that their trainer was either not aware of or had not properly taken into consideration when designing their fitness regimen.
What are the best ways for a Personal Trainer to protect themselves?
There are two primary tools that a fitness professional can use to transfer the risk for the exposures discussed above away from themselves. First, appropriate and sufficient Liability Insurance will transfer much of the risk to the insurance company. Second, a properly written Hold Harmless Agreement or Liability Release or Waiver can transfer some of the risk back to the client.
APPROPRIATE LIABILITY INSURANCE
Appropriate insurance coverage should include all of the coverage included above, including Professional Liability with a definition that includes nutritional counseling, Products and Completed Operations Liability, Personal and Advertising Injury, Cyber Liability and Sexual Abuse and Molestation. A policy tailored to fitness professionals should also include General Liability so that they have coverage in their own name for premises exposures in the event they are ever a party to a slip and fall or other premises related claim.
Additionally, a personal trainer should select liability coverage that is written on an Occurrence Based Form rather than a Claims Made form. An Occurrence policy protects the trainer from any covered incident that “occurs” during the policy period, regardless of when the claim is filed. An occurrence policy will respond to claims that are reported even after the policy has been cancelled or non-renewed, as long as the incident occurred during the period in which the coverage was in force. Claims-made policies provide coverage for claims only when BOTH the alleged incident AND the resulting claim filing happen during the period the policy is in force. Coverage is provided as long as the insured maintains continuous, uninterrupted coverage. A claims-made policy will cover claims after the coverage period only if the insured purchases extended reporting or “tail” coverage, which can become expensive.
SUFFICIENT LIABILITY INSURANCE
There are a number of important considerations for a personal trainer to review in determining what liability limits are sufficient for their business. The driving factor for most trainers is the insurance requirements of the facility(s) where they will work. Each personal trainer should also make sure they have enough insurance to protect their individual business and personal assets. The specific exposures of their business, such as, the populations they are training or the activities they engage in with their clients can significantly impact their risk and the amount of insurance they should purchase. For example, higher limits should potentially be selected when working with at risk populations or minors. The amount of nutritional counseling and nutritional product or supplement sales that a trainer engages in should also be considered. The following are industry standard limits:
$1,000,000 Each Occurrence
$2,000,000 General Aggregate
$1,000,000 Personal and Advertising Injury Limit
$1,000,000 Products and Completed Operations
NOTE: Higher limits and umbrella policies are also available from most insurance carriers that specialize in the fitness industry.
HOLD HARMLESS AGREEMENT
According to risk control services provided by Liberty Mutual Insurance:
Hold Harmless Agreements are waivers or liability release documents that are often a contract between a service provider and a participant that release the service provider for any liability for loss suffered by the participant as a result of “ordinary negligence” by the service provider.
The degree of enforceability for hold harmless agreements varies considerably by jurisdiction, depending on case history, state statutes, the application and legal status of involved parties (i.e. minors vs adults, etc.)
To help ensure the enforceability of a hold harmless agreement, it is critical that they meet this criterion:
~ Stand-alone documents
~ Clear and unambiguous language
~ Specifically state that by signing the participant relinquishes rights of recovery for the service providers “negligence”
~ Explicitly define the “risk inherent” to the participant
It is critically important for personal trainers to document that all of their clients sign a hold harmless agreement and keep copies of the agreements. Due to the difference in state laws, fitness professionals should consult a local attorney to help them develop or review their liability waiver language.
It is also appropriate for personal trainers to utilize a heath history questionnaire to review any pre-existing conditions or other factors about their client’s health that would impact their readiness for participation in fitness activities at different levels. Rather than being a negative experience, spending the time to review both of these documents with new clients will usually help build the relationship and enhance a trainer’s professionalism.
What is the next step for a personal trainer?
After a personal trainer has appropriate and sufficient liability insurance in effect and they have developed their hold harmless agreement and health history document(s), they should continue to review their insurance needs each year when their insurance policy comes up for renewal and make sure that the coverage does not lapse. Updating their operations and exposures with their insurance representative will help ensure that they are covered for new programs and opportunities that develop with their client base. Keeping the business protected is an important part of continuing to grow a personal training business successfully.