Friday, September 02, 2005

AFA Insurance Facts

The fact to be known is 'that' the insurance fee increase was actually created by individuals promoting another national association for teams on our level that bragged (on-line) about how well their teams were drawing at the gate (thousands, rather than hundreds), and their teams ability to pay their players - because they were 'minor league professionals' not low-life 'semi-pros'. The insurance underwriters got a hold of that info and figured the AFA lied to them 5 years ago when we convinced them that teams playing under the AFA banner deserved a price break for liability insurance because our teams should be considered "adult amateur" - and the spectator liability risk (of hundreds rather than thousands) was not what it appeared to be. They agreed and set up a reasonable price of $475 per team. Over the years local agents were able to cut their commissions or find other major insurance carriers to give coverage to their local teams - at a lower price. Basically, a price war ensued and the price of liability insurance was reduced to as little as $230 a team  per season. The "per-season" portion of those policies came back to bite some teams in the butt as most were for coverage for 4 or 5 home (season) home games. Teams making their playoffs or hosting pre-season games needed to purchase "riders" to cover those extra games. Those "rider" polices can cost as much as the originals so the savings of cheaper coverage went right out the window.
In establishing the AFA's original coverage, we were able to convince our major carrier (K&K Insurance Company) that for the established price of $475 per team would give our member teams 12 month coverage and save their agencies the administrative work of writing "rider" policies every time a team added a game or needed additional coverage for teams new preseason practice schedule.
All went well for years until new upstart national 'minor league' groups started bragging how much better their teams were drawing them those playing on the semi-pro level. We know that's not true - but the insurance carriers didn't.
At the end of the 2004 season K&K (worlds largest) announced that they were getting out of the 'adult amateur football' liability insurance coverage business leaving semi-pro football teams across the country without the ability of renewing the liability insurance program once their current policy expired. The smaller carriers reacted in the same fashion - and dropped their coverage as well.
At that time the AFA and our agency (Sadler & Company) appealed to K&K to reconsider working with the AFA as their decision to drop liability coverage would literally be devastating to the semi-pro football level of football. After a number of conference calls K&K agreed to write coverage for AFA teams at the original rice of $475 per team. Rather than have no coverage at all - the AFA agreed. Then to help those semi-pro teams lost in the insurance confusion . . . we (AFA) agreed to allow teams to join the AFA as 'associate' members (for the remainder of the 2005 season) and take advantage of our national association's new agreement with K&K for liability coverage. The AFA also announced that it will continue to accept associate memberships ($100 per team) only until the end of the 2005 playing season. AFA memberships are based on a calendar year - not a 12 month period.
As of January 1, 2006, only complete leagues will have the opportunity to join the AFA and take advantage of the associations many benefits.
We're hoping your league's teams will see the advantages of becoming members of the American Football Association in 2006.

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