Fitness Center & Gym Insurance: A Beginner’s Guide
Among life’s inevitabilities, things going wrong at a gym is up near the top. Weights will be dropped on toes. Machines that need maintenance will break without warning. People will work out overzealously and injure themselves. Blame it on Murphy and his unjust Law: Whatever can go wrong, will go wrong.
If you’re starting a gym or installing a fitness center into a property, you have to keep this law in mind. Gyms are full of prone-to-mistake people and toe-crushing exercise equipment, and you, the owner and manager of this gym, are held legally responsible for any and all injuries. Thus, you need to protect yourself.
That’s where fitness center and gym insurance come in.
The Basics: Types of Insurance to Be Aware Of
For a basic grasp of how insurance for gyms works, you need to be aware of the blanket terms that will protect your business from substantial litigation costs. Those include:
- General Liability Insurance
- Worker’s Compensation
- Property Coverage
- Cyber Liability
- Professional Liability
These terms and policies will help you learn why your business needs wellness and fitness insurance.
General Liability Insurance
Consider your members. A diverse group of people is going to be working out side-by-side in your building: older and younger people, newcomers and experienced lifters. Employees aren’t able to micromanage each person to ensure their safety; instead, general gym guidelines need to be enforced to reduce risks. But rarely does a month (nonetheless a week or a day) go by without rules being broken, injuries following, and general liability coverage is needed.
And for the times when accidents happen for no apparent reason—slipping in the locker room shower or tripping on steps (it doesn’t have to be exercise-related)—you also need a general liability policy.
So, what exactly does a general liability policy cover?
- Injury Liability – When a bodily injury occurs in your gym and fitness center, you might be liable for medical expenses; this coverage helps with those costs.
- Employee Benefits Liability – An employer is covered for errors or omissions in the employer’s administrations of its employee benefits program. An example would be if the employer forgets to add medical insurance coverage to the employee’s plan.
- Equipment and Products Liability – Gym machines break and defective technology is recalled each year. You need to replace these machines or install new ones to keep your members active. Nobody wants to attend a gym where every other machine is broken or is on the verge of breaking. Insurance can help cover those expenses.
These days, cybercrimes happen to every business. No longer are they geared toward large companies with extensive data logs. Small and mid-sized businesses are increasingly targeted. In 2015, The SEC reported that 60% of cyberattacks targeted these small and mid-size businesses (SMBs). They also found that 75% of spear-phishing was used on SMBs.
Most gyms and fitness studios are considered SMBs. Although your gym membership database might not seem like an ideal candidate for hacking, the opposite reasoning applies. Because most gyms and fitness centers are smaller businesses focused on people’s health, not their data security, their cybersecurity operations are usually limited. This allows for easy data theft.
A cyber liability insurance policy covers costs from:
- Both internal (employee mishaps) and external (hackers) data loss
- Cyber extortion costs
- Cybersecurity costs, including regular updating and implementing security frameworks
Services and Professional Liability Insurance
If your gym offers personal training, classes, instruction, you’re going to need to protect yourself. Fitness professionals may offer advice on how to improve outside the gym which results in a terrible accident. A cycling class may push someone to have cardiac stress during or after the class is finished. Being insured will protect against situations when instruction or advice results in negative consequences.
Gym insurance needs to include protecting your employees who are operating and maintaining the exercise equipment. This includes everyone from personal trainers to janitors who clean the heavy machinery. If they’re injured on the job, they need to be compensated for the time they can’t work. This is by definition worker’s comp.
Worker’s compensation insurance is there to help stifle the income loss of the gym. If fitness professionals experience a common rotator cuff injury or lumbar strain and can’t perform their job, members aren’t paying for their personal training sessions and the personal trainers aren’t making money for themselves and the gym. Thus, having coverage can protect from some of these losses.
With any business should come property coverage. You never know who’s going to try to break into the building and when. You also can’t predict natural disasters or other unknown risks that might result in property damage for your gym.
The building next to yours could catch fire and singe off half of your wall. Unless you had comprehensive property coverage that included external fire damage, that’s money out of your pocket.
Property coverage typically includes:
- Theft or vandalism
- Fires, earthquakes, and other natural disasters
- Necessary construction costs
- Damage to the building
What Does Fitness Center & Gym Insurance Provide?
Having gym insurance allows for you to operate the building, for employees to work with members, and for members to operate heavy machinery without fear of losing your business to a bodily injury lawsuit. Think:
- Medical Expenses – Medical bills can easily reach hundreds of thousands of dollars when surgery or extensive rehabilitation is necessary.
- Litigation Expenses – If the gym believes they are not at fault and does not want to settle, they may still have to fight the case in court. Insurance coverage provides litigation support.
- Loss of Income – From worker’s comp to multiple equipment failures to data security issues that result in monetary loss, insurance coverage is there to help you.
Determining what the cost of gym insurance is will depend on your specific liability plan and what you want it to cover. But in essence, having a gym insurance policy provides peace of mind. It allows you to get back to focusing on your business and helping your community improve their health.
It allows you to counteract Murphy’s maddening Law.
NCBI. Personal Trainer Demographics, Current Practice Trends and Common Trainee Injuries. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5066109/
SEC. The Need for Greater Focus on the Cybersecurity Challenges Facing Small and Midsize Businesses. https://www.sec.gov/news/statement/cybersecurity-challenges-for-small-midsize-businesses.html