Latest / BREAK/FIX the Motorsports & Vehicle Enthusiast Variety Show / Demystifying Track Day Insurance: A Deep Dive with Lockton Motorsports

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Demystifying Track Day Insurance: A Deep Dive with Lockton Motorsports · BREAK/FIX the Motorsports & Vehicle Enthusiast Variety Show

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Grand Touring Motorsports started as a social group of car enthusiasts,
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but we've expanded into all sorts of motorsports disciplines, and we
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want to share our stories with you.
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Years of racing, wrenching, and motorsports experience brings
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together a top notch collection of knowledge and information
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through our podcast, Brake Fix.
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Safety is always paramount in any sport, and motorsport is no exception.
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However, for many of us, track insurance is still a hit or miss idea.
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There are a number of us who drive cars cheap enough that we feel we can take
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the risk, and then there are others who drive expensive cars that would
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financially and emotionally tear them apart if something bad were to happen.
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Some of our more senior members will tell you, Don't drive something on track
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that you can't afford to walk away from.
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Well, not everyone shares this viewpoint.
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That's right, Brad.
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Insurance is a funny thing.
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And in most cases, it's a necessary evil.
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It's something that we all pay for, but we also hope to never have to use.
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And in the world of motorsports, especially high performance driver's
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education, HPDE, there are a few companies out there that may offer track insurance.
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But on this episode, we're going to focus on one specific company.
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HPDE.
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Lockton Motorsports, the original and largest track insurance
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provider in the United States.
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And joining us tonight from Lockton is Ryan Staub to educate us on
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all the intricacies and details surrounding track day insurance.
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And as always, I'm your host Brad and I'm Eric.
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So let's roll welcome to break fix ryan.
1:34
Thanks guys.
1:34
Glad to be here Let's talk about how you're involved in motorsports What's
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your background is and kind of lay it out for folks if we get to know you a
1:42
little bit better Yeah, sounds good.
1:44
Uh, so I'd say, uh, you know, the the sickness has always been there.
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Uh, you know the love for cars the you know desire to do things fast in
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cars and Castro was 22 years old got my first car First, uh, I'd say kind
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of real performance car at E36 M3.
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Uh, that would have been 2002, you know, when my young kids stumbled
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into a, uh, BMW car club gathering at my, uh, kind of in my area and Kansas
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city and a whole bunch of these guys started talking about these HPDE track
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day events, which I had never heard of before, you know, the, the hook, you
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know, went in pretty hard at that point.
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Heard a little bit more about this stuff and decided to, uh, to really
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get engaged and involved in it.
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So it was a slippery slope from that point.
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I think I did my first, yeah, I did my first HPDE event before I did any
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autocross the first couple of years.
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Well, it was a pretty good mix between the two.
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But, you know, doing on track events as opposed to autocross, uh, kind
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of really excited me, you know, kind of played more to my passion.
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So did that a whole, whole lot over the next three years.
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I think, uh, those first couple of years I was doing eight, nine, 10 events a year
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and, uh, about 2005 started instructing.
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About two years after that, still relatively young, 28 years old at that
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point, and the local BMW club, the chief instructor decided to resign, got my
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shoulder tapped as kind of a up and coming instructor to be the chief instructor
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for my local BMW club, uh, right around that time, started club racing.
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And since that point, I've continued to race, continued to act as chief
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instructor for my local BMW club, and also do quite a bit of instructing
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with other organizations, whether it's.
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You know, PCA, Audi club, NASA, so on, right?
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So let me ask you this question, because we've all heard the jokes.
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We've all seen the movies and the sitcoms, you know, the, the insurance adjuster.
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It's not the most exciting personality in the world.
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It's not the most exciting job in the world.
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So how do you go from tried and true petrol head to working
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for an insurance company?
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Yeah.
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So kind of in that progression.
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Around 2005, I want to say 2006, uh, you know, I had friends that had had on
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track incidents prior to that, but no one really ever had any issues with claims.
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They're, you know, you always heard the stories of the, the people that, The
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claim to their insurance company and insurance company basically gave them,
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you know, no hard time about covering the claim since it was an educational
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events and most insurance policies had timed or competition event exclusions.
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For the most part, people didn't have issues.
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We also heard the stories of, you know, people that.
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Drove the, the, the car or towed the car away from the track, put it in
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a ditch and then tried to, you know, you know, explain the situation, how
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they lost control and somehow the car ended up in the ditch and got damaged
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on, you know, three different sides of the car that looked like they hit.
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That would never, that would never happen.
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Never, never, never.
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It's also great that they do it two miles from the track too.
5:04
Yeah, exactly.
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So, so about, I want to say 2005 2006, I had my first couple of
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friends that all of a sudden reported claims and, You know, claims weren't
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covered at that point in time.
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I was in the insurance world, but not in the motorsport insurance world.
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So, you know, really, uh, a and an opportunity, but be an industry that
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really needed an insurance solution to, to really be sustainable because,
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uh, I think to Brad's point earlier.
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So a lot of folks that have cars that, you know, frankly, they can't afford to
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write off should the worst happen and they need some sort of financial protection
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through insurance to be able to do that.
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So, uh, you know, essentially went to the executive committee of locked in.
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So locked in where the largest privately held insurance
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brokerage firm in the world.
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And the role that I'm in is that of a producer, essentially
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producers at locked in.
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You know, build a business and whatever sorts of industries they want.
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Motorsports, obviously being my passion, I, you know, found a way to do that.
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So I got their approval to do it and it went out to the market and
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I heard a whole, whole lot of no's from various different insurance
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companies that we tried to engage, to provide this sort of solution.
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Eventually, you know, found an insurer that was willing to listen
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to us, uh, to actually go to an event and see the structure and a typical
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HPDE event with classroom and in car instructors, you know, designated
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passing zones, so on, so forth.
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And I really launched the, the first viable insurance program to cover
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participants in HPDE events at that point.
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So how does someone sign up for track insurance?
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What are the costs, the plans?
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Are there different packages?
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So, uh, we do this all online.
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Of course, we've got support available via phone.
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If, if any individuals need help with it, but it's really pretty straightforward.
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You know, our customers go to locked in motorsports.
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com click on each PDE track, the insurance from that point, they'll put in details
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of the event that they're going to.
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So, event organizer name, the track, the event dates, they'll
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put in details of their vehicle.
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We have made some changes to that, which I think from the viewer questions you
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shared, we'll get into more details on kind of how you determine the value.
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But from that point, they put in a value for the vehicle, hit the
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quote button, spits out a quote.
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If they want to buy it, they put in, you know, details of payment
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information and a policy sent to them.
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But then.
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Okay.
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You know, a handful of minutes following that.
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So today we only offer single event policies.
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Previously, we had done multi event policies.
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Be honest, the way that it was structured with insurance companies, uh, we, we
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had six, nine, 12 and 15 event policies.
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What we ended up finding is the policies were kind of a
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use it or lose it structure.
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So say you buy a 12 event policy, it's an annual term and you have a
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catastrophic engine failure, life gets in the way you get a work reassignment,
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work gets too busy, you can't go to events, whatever the situation might be.
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We had quite a few customers that were not utilizing all their events.
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So the discount that we were able to offer on the multi event policies
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was actually not benefiting them.
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So about a year ago, actually a little over a year ago, we moved
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away from those multi event policies.
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So it's just the single event structure today that honestly is
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what we came out with in 2008.
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Single event, multi event versus what we're used to with our actual
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automobile policies where we're paying by the year or paying by the half year
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or monthly or whatever it might be.
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Why not move to a structure like that?
8:42
Yeah, so, so, you know, I think the big difference here is, you know,
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law of large numbers doesn't help us quite as much in the HPDE track day
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insurance world where there's just a, You know, use your typical street
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insurance policy as an example, where, you know, you've got millions of drivers
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covered throughout the United States.
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Your insurer will ask you basic information about your use of the
9:07
vehicle and how many miles you do a year.
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Some of them will actually audit you based on that mileage,
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but instant frequency rates.
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When it comes to street insurance, it's easier for those insurers as they
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have this massive scale of individuals they're insuring to spread that risk
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and kind of come up with appropriate rates based on the use, the mileage,
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the value, so on, so forth in our world where instant rates are a little bit
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higher than they are on the street.
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A and B, where there's a pretty huge range in the activity of individuals
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ranging from, you know, your very, very casual HPDE track day person who
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does one or two events versus your very active person who does 18 or 20 events.
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The risk changes so, so significantly to, to the point where, you know, there,
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there's really just not a good way, at least at this point in time, with the
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number of individuals participating in the sport and also utilizing insurance
10:05
solutions that, you know, the, the true annual coverage, regardless of events
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is really practical to a point, right?
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Because say I have an annual policy and my car breaks down halfway through the year.
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I'm still paying to cover the car, whether it's driving or not or say an incident
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occurs and I have to total it out.
10:24
I guess it's the same as the multi car policy like you
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said to your to your use case.
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If somebody moved away or they can't go to an event, if the policy is
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already prepaid for at that point.
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So.
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I don't know.
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I guess in my mind, it's a peace of mind thing because when I
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pay my normal car insurance, I'm covered for X amount of time period
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and then I don't think about it.
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So I think then it doesn't matter if I do three events back to back or if I do
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three events over three months, right?
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It's, it's a weird, I guess, dynamic there, but I understand
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where you guys are coming from.
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But I think that also leads into the question about, you know, what does
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the policy actually cover when you do sign up for that single event now?
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You know, essentially what the policy covers is.
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Essentially, any physical damage that occurs to your vehicle once you enter
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the grounds of the racetrack that you selected between the effective
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and the expiration date, so the dates that you selected for your event.
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So, You know, driving your car to the track for a street license car, uh, that
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vehicle would be covered on the road, obviously, as you're driving to the
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track by your street insurance policy the moment you hit the grounds of the
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racetrack facility, coverage kicks in.
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So if a hailstorm comes through while your car is parked in the paddock, if
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a low speed collision occurs in the paddock, you know, five, ten mile an hour,
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but not Actually on the track surface itself, something like that would be
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covered very, very broad coverage from that point that you enter the track, but
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it only covers you between policy dates.
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A and B.
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Once you actually enter the racetrack facility, and it is unlike street
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insurance where, say, you know, person a hits person B and person a is at fault.
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And person A's liability policy covers the physical damage to the other
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person's car and their comprehensive and collision coverage cover their car.
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This policy is regardless of fault.
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You know, from the moment that we designed this insurance package, a lot of it was
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built upon a lot of the risk management practices and insurance practices in place
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by event organizers that put on events.
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And by that, I mean, We all sign these waivers when we enter the facility.
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A lot of people have never read those waivers, but essentially what you're
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doing is waiving your rights against the event organizer, against the track,
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and also against all participants, uh, to seek some sort of recovery
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from any damages that you might occur that could be, quote, their fault.
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So our policy is designed in that way to where As an example, you're going
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through turn one at VIR and, uh, someone totally missed the brake zone, slams
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into you right as you're turning in your policy that you bought still covers that.
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I was going to ask about the declared value since you
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touched on it a little bit.
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So for example, I've got a 2003 GTI with a little bit of money put into it, but
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Do you have safeguards in place that prevent me from saying that my car is
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worth 75, 000, you know, for example?
13:23
Brad, you're a smart guy.
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I wish I met you a lot of years ago.
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But for the longest time, we had a set up where you declared the base value
13:31
of your vehicle, and then we had you input details of the modifications
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that you have, kind of specifying, I've got these coilovers, these
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wheels, this intake, blah, blah, blah.
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And, you know, basically the base value of the car plus all the
13:46
modifications was your agreed value.
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And for a good number of years, we had no issues at all with that.
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And to be honest, we had a little string of some fraudulent claims with some
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cars that were probably worth about a third of the value that they declared.
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And a lot of the modifications that they said that they had on those
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vehicles might have not been there.
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So, so to to a protect for that situation, but be still make the policy
14:15
purchase process very simple and easy.
14:18
We moved about a year ago to a different structure where when you
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buy a policy, you list the value, the agreed value that you want to ensure
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the vehicle for within the policy terms.
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There's now a provision.
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That if you have modifications in excess of 10, 000 of modifications,
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that you're required to provide some documentation for those
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modifications should you have a client.
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So that's our kind of protection against that situation.
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It makes it way easier to buy a policy because, you know, as an example, if
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I take my race car to an event and ensure it, you know, for the event,
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the list of modifications would take me 30 minutes to input on our old website
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versus now I can just list a value.
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I've got all the documentation on the modifications to it that I
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can provide should I have a claim.
15:04
Yeah, so this is a really good segue here because it can go one of two ways, right?
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In the old days, especially if you're dealing with an insurance
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company, let's say like for classic cars like a Hagerty or something
15:12
like that, not to call them out, but they have their specialty as well.
15:16
You had to get an appraisal.
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So, yeah.
15:17
Yeah.
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You had to say this car is worth X because of its age, because it has
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modifications, or it doesn't, it's original, it's been restored, etc.
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And then you come up, you know, and the appraiser, I always felt that
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they were super subjective, right, in the way they looked at things.
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And it's like, well, I have to compare it to another 1962 Maserati
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that three people own, right?
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And it's kind of weird, and it's just how it is.
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But in this case, and this is a, this is really a reach back to a previous
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episode we did with the guys from tuner log, where they're trying to capture this
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information to better quantify the value of a car because they want to capture all
15:52
those receipts in a system that you would have, let's say digitally or whatever.
15:55
And so you're going in.
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to a tuner shop and you're getting those BBS rims and you're
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getting those Bilstein coilovers.
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That's all there.
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And it's like now I could turn that over to locked in and say,
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Hey, hey, look, here's my proof.
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This is what I spent.
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Yeah, I spent it 10 years ago, but I spent it on that particular car because
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that's also the sticky situation you get into with all this is depreciation.
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Well, those shocks have 10, 000 track miles on them, which is like,
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you know, 900, 000 street miles.
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And so what are they really worth at the end of the day?
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Well, it's, it's the cost to replace them in full, right.
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Is what we're getting down to here.
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So I can see where these staggering full value numbers come out from.
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And I, I agree with Brad.
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I don't think it's, I don't think his GTI is worth 75 grand, but it wouldn't be
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unreasonable for him to say, Hey, I need a declared value policy of 15, 000 to cover.
16:44
Everything that I've done to this, including labor hours and everything
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else over the years, right?
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Exactly.
16:50
Yep.
16:50
Uh, you almost sound like an insurance guy.
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Uh, so, so the depreciation is the actual cash value, which is what your typical
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street insurance policy would have.
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And they, you know, try to devalue a lot of the parts on your car based on that.
17:02
So doing the agreed value structure and you've got the opportunity to
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provide receipts for those things.
17:08
Cause yeah, I mean, the, the reality is you're not going to find, well,
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it'd be very difficult to find.
17:13
You know, those PBS wheels, those NCS dampers or Bilstein, I think
17:17
you said, you know, are you going to find the exact setup that you have
17:21
used with the same number of miles that you can, you know, replace
17:25
exactly the condition that you had?
17:26
No, there's no chance of that.
17:28
So you've got to replace it.
17:29
Well, it's time to upgrade to Olin's at that point, right?
17:32
Yeah.
17:34
That's the way you think.
17:36
If you're going to do it right, we focused a lot on the car.
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We keep talking about the car, the car, the car.
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And I think one of the bigger things that people think about, you touched on
17:45
earlier about the automotive insurance policies is there's that liability part
17:49
of it that covers the person, right?
17:52
And then there's the comprehensive part.
17:53
There's multiple pieces to the automotive insurance policy.
17:56
When you talk about track insurance.
17:58
All you hear about is the car.
18:00
And I know as we get into the Q and a session later, there's a lot of questions
18:03
about what does the policy really cover?
18:06
And I think we're going to unpack that as we continue the conversation, but
18:09
let's focus a little bit on the driver.
18:11
Does the driver play into this equation at all?
18:14
From a coverage standpoint, it's really just covering the car.
18:18
And to your point, uh, I think some of the questions that you shared, you
18:21
know, really step into that liability.
18:25
While the typical HPDE track day insurance policy that you find in the
18:29
market does not provide coverage for any third party liability, there are
18:36
some protections in place in some areas.
18:38
So we can, again, unpack that a little bit, but again, your
18:42
typical HPDE insurance policy is just covering the vehicle itself.
18:47
Not the, not the driver.
18:50
All right.
18:50
So let's talk a little bit more about the car and I'm going to, I'm going to
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steal a question out of the Q and a pile here, because I think it's important
18:56
to the conversation we're having.
18:58
So you talked about driving the car to the track, crossing the gate and
19:01
crossing that threshold onto the compound.
19:03
Once you're on the compound track insurance kicks in.
19:06
What if I brought it in on a trailer?
19:08
And I know there's trailer insurance, right?
19:10
So now we're quadruple stacking insurance here, right?
19:13
We've got the life insurance for, to cover me at the track.
19:16
We've got the automobile insurance to get me there.
19:18
I've got trailer insurance to cover the trailer.
19:21
And now I got track insurance for the track car.
19:23
Oh my God, this is getting a little complex here.
19:25
So.
19:26
Does track insurance, as you said, once you cross the gate there, does
19:30
it cover the car on the trailer?
19:32
Technically, if the car is on the trailer and insured for the event,
19:38
once you cross those gates, your HPDE insurance policy would cover that.
19:42
We do offer, and there are other providers of this, we call it off track insurance.
19:48
It's sometimes called storage, transit, and paddock insurance.
19:51
For a Non licensed vehicle.
19:54
This is essentially insurance that covers the car anytime that it's
19:59
not on the racetrack and not being driven the exception to that.
20:05
We've got a carve out on our policy while the car is being
20:09
driven on and off a trailer.
20:11
It's actually covered.
20:13
So this is intended only for, you know, vehicles that are not street licensed and.
20:19
The policies are, in my opinion, kind of dirt cheap compared to, you know,
20:24
your typical street insurance policy.
20:25
So for the guy with a dedicated track car or race car that they
20:29
utilize in HPD events and or races or time trials, whatever it might be.
20:35
They, they can buy these policies.
20:36
That's annual coverage.
20:38
You can list the car, you can cover the trailer under that policy, you can cover
20:43
any parts and equipment that you might have that are related to your HPD events.
20:48
And you can also cover any tools and spares that are special, you
20:52
know, kind of specialized to, uh, your motor sports type activity.
20:56
So the, you know, the intent of it is to be.
21:00
Your one specialty policy that covers the vehicle and all your
21:04
race related equipment everywhere except for when the car is being
21:08
driven or driven on the track.
21:10
So parked in my driveway on my trailer, let's just say, or in the street,
21:15
getting ready for an event, the car and the trailer are covered at that point.
21:18
Interesting.
21:20
That's also in transit to the event or not?
21:24
Correct.
21:24
Yeah, the vast majority, and there's a reason why the rates are so low on this.
21:30
You know, people don't tend to have nearly as many claims on an off track policy as
21:35
an on track HPD insurance type policy.
21:38
So the rates are very low.
21:39
The vast majority.
21:41
Of claims that occur are theft or like a trailer overturn type situation,
21:47
you know someone gets into a big sway condition towing their their trailer
21:51
to the track and Have a trailer overturn something along those lines
21:57
I want to put a little asterisk there.
21:58
We're still talking about covering the car though, because I've heard
22:01
stories of guys, man, I was trailing out the road, Atlanta, and my
22:05
wheel passed me at 60 mile an hour.
22:07
And it came off the trailer, right.
22:08
Went across the median.
22:09
Like you hear those stories.
22:10
Next thing you know, the thing's dragging across the pavement and the trailer's
22:13
busted, broken axle, whatever it might be.
22:15
So kind of pulling these fine threads out, does it cover the trailer or
22:20
does it cover the car on the trailer?
22:22
Right.
22:22
So.
22:23
Is it comprehensive in that respect?
22:25
Yeah, it covers the car for sure because you have to buy that policy.
22:29
You have to cover the car.
22:31
If you elected to have coverage on the trailer, it would cover
22:34
the trailer in that situation.
22:36
But to take your little scenario a step further, let's say that wheel that just
22:40
flew off, which I might've had happen once or twice over the last 20 years.
22:45
So I have had that, that, that exact situation.
22:47
Uh, if that tire, uh, or wheel and tire.
22:51
were to, say, you know, cross into oncoming traffic and hit another vehicle,
22:57
your tow vehicle insurance provides a liability coverage for that situation.
23:01
So, any third party damages that would occur would be under your
23:06
primary auto liability coverage that would be on your tow vehicle.
23:10
Going back to one thing, it gets a little bit complicated with street
23:15
license cars, not street license cars.
23:17
So, so in your situation of towing the car to the track, if you've got a
23:21
street insurance policy for a licensed vehicle, and you're towing it to the
23:26
track, your street insurance still should cover the car in transport, and
23:31
then your HPD insurance policy wants to enter the grounds of the racetrack,
23:36
that's when that would kick in.
23:37
Okay, well, we're covering all bases here because even within GTM, we have a
23:41
huge mixture of folks that are driving to the track driving car or trailer
23:44
and cars with tags on to the track.
23:46
And then there's those of us that have unlicensed cars that are going to the
23:50
track or rather untagged cars going to the track, you know, 1 of the.
23:55
People really never ask about and they, I hope most people understand
24:00
this, but, you know, as far as what the policy covers, uh, any auto related
24:06
policy is going to have something called a mechanical breakdown exclusion.
24:11
So this is.
24:13
Kind of the insurance company's way to protect themselves for covering
24:17
kind of wear and tear items and or things that on a newer vehicle
24:21
would be covered under a warranty.
24:22
So obviously, I think everyone understands, oh, my, my brake pads
24:27
and my tires got very damaged at my HPDE as I was, you know, driving
24:31
my car fast around the track.
24:33
You don't expect You know, the quote damage or the wear on those types of items
24:38
to be covered under an insurance policy where, you know, I've only had a couple
24:42
people not understand this, but I just want to make sure people understand if
24:46
you money shift your car for those with manual transmission cars, you're doing a
24:51
four to five up shift and you accidentally go four to three and zing the motor.
24:56
It's done.
24:57
It's dead.
24:58
Our insurance policy would not cover something like that, but
25:02
let's use a situation where.
25:04
You money shift the car back in checks up real bad as you're going into the corner,
25:09
you spin off the track and hit the wall.
25:12
Any resulting damage from a mechanical breakdown, whether that's, you know,
25:17
grenading your engine by doing a money shift, or you've got a suspension
25:21
failure, whatever that might be.
25:24
Any resulting damage that occurs after a mechanical breakdown would be covered.
25:29
I will use the example of the suspension failure.
25:32
If say you've got a left front control arm that that breaks as you're going
25:37
into a right hand turn and car goes straight ahead straight into a wall.
25:42
You know, I've yet to encounter a situation where we've had a, you know,
25:47
the claims adjuster tried to fight a claim saying, Oh, we think this control
25:51
arm broke before it hit the wall.
25:53
So we're not going to cover that control arm that, you know, that, that type
25:57
of thing I've never encountered and, you know, to be honest, we've never
26:01
encountered an issue over, What's it been 12, 13 years of there ever being a
26:07
question of did the engine get damaged after the incident or before the incident?
26:13
But technically, if the, you know, by the way, most insurance policies
26:17
are written, if the damage occurred prior to the instance, and it was
26:21
a mechanical breakdown type of situation, it would not be covered.
26:24
So I've got two things here.
26:26
One.
26:26
So this past weekend I was at V.
26:28
I.
26:28
R.
26:29
and I had a wheel hub failure and you put you're saying essentially
26:33
is had my wheel come off and all kinds of damage would have been
26:36
caused to the car from being dragged across the ground across the track.
26:41
Then you're saying that would be covered.
26:43
Yeah.
26:44
So all the resulting damage and, you know, by the letter of the policy,
26:48
uh, The hub itself wouldn't have been covered, but that wheel, if it smacked
26:52
into something, the wheel, any damage that occurred to it wouldn't be covered.
26:56
So you'd be out, I don't know what it runs on your GTI, but uh, whatever,
27:01
150, 200 blocks, you'd be, you'd have that part of it not covered,
27:04
everything else would be covered.
27:05
That's only if he made contact though, right?
27:08
No, no.
27:09
Uh, well, I mean, he's going to make contact with the
27:11
ground after he loses a wheel.
27:13
Uh, you know, that that is contact any other damage that would occur
27:17
associated with it would be covered whether it hits something or not.
27:20
So, with modifications, you can either install them yourself, or you can go
27:24
to a mechanic to have them installed.
27:26
Is there anything in the policy, any provisions against the shade
27:29
tree mechanic and the people that are doing their own DIY?
27:33
Is the policy say anything about that says absolutely nothing about that.
27:38
So that type of situation, you know, let's use the total loss scenario.
27:43
So an individual that hasn't done their own work on their car that
27:48
has paid a performance shop to perform modifications when they're
27:52
coming up with their agreed value.
27:53
They should be taking the base value of the vehicle and then
27:57
adding the invoice for not just the parts that they put on the car, but
28:01
also the labor associated with it.
28:03
So, you know, I do think we get some people that underinsure that, uh, you
28:08
know, no sense of how to modify the car themselves and, you know, to put
28:12
themselves back in a whole position.
28:15
Really should include the labor as part of that modification cost.
28:19
But Brad, to your question, you know, if you're doing the, the work
28:22
yourself, in the case of that total loss, you add the mods to your value.
28:26
If you've got a total loss, you know, no question.
28:29
That's, um, you know, that's, uh, those modifications are gonna be covered subject
28:34
to the, the value that you selected.
28:35
If it's a partial loss, the, the only risk that you'd run in that situation,
28:40
if you're the DIY guy that's put all the modifications on yourself.
28:45
Is your car could come closer to being totaled as the adjuster, you know, as
28:51
they're adjudicating the claim, kind of going through the process of handling the
28:54
claim, they're going to come up with a higher repair cost because they're always
29:00
going to use a repair facility to come up with the estimate to fix the vehicle.
29:05
And then there's a, You know, calculation essentially that's going on in the
29:08
background to say what repair cost gets to the point where it makes more sense to
29:14
total the vehicle regarding a total loss.
29:16
I think, in my experience with a traditional insurance
29:20
company, the insurance company pays you for the total loss.
29:23
They retain the vehicle, but then you have the option to buy the vehicle back.
29:27
Is that the similar process or the same process through the track insurance?
29:31
Every customer gets the opportunity to buy back the salvage.
29:34
I'd say, you know, the The majority of our customers that end up buying
29:41
back the salvage probably come out on top as, you know, performance vehicles
29:46
with a lot of modifications and or higher performance vehicles don't tend
29:50
to attract as much money through the auction sources as they probably should.
29:55
And, uh, you know, as a result, I think a lot of clients end up coming out
29:59
pretty well, uh, when they buy it back so that you've always got the opportunity
30:03
and, you know, essentially the way that it's done is, you know, once they
30:07
determine what the salvage value for the vehicle is, what's expected that it
30:11
would be able to get at auction, that dollar amount is offered to you should
30:16
you not take it, you get your it out.
30:17
Agreed limit of insurance minus deductible.
30:20
Should you decide to keep the salvage, you get the agreed value
30:23
minus deductible minus salvage value and you retain the vehicle and if
30:28
you're listeners or either of you are thinking about it, unfortunately, they,
30:34
you know, they're kind of required.
30:36
To go through the process and put a, you know, a salvage title on
30:40
the vehicle through that process.
30:42
So it's not by buying it back.
30:44
You can sidetrack having that salvage title.
30:46
That's going to live with the car forever.
30:48
That's okay.
30:49
90 percent of all Miatas already have salvage titles.
30:53
Good point.
30:53
Very true.
30:55
So that leads me into the next question, actually, since we're still on this
30:58
big topic about How the policy works, what it covers, what it doesn't.
31:03
I think we missed a big point here in defining what a vehicle is.
31:07
And so in our minds, we're thinking production based cars.
31:10
We're thinking streetcars.
31:11
Does this cover, we're talking track insurance now.
31:15
Does this cover motorcycles?
31:16
Does this cover, you know, dirt late models?
31:19
Does this cover formula cars?
31:21
What kind of, what is a vehicle?
31:23
Is it ATVs, ski, you know, boats?
31:26
I don't know.
31:26
So, because we're multi disciplined, right?
31:29
And we're going to, I'm going to get into that in a minute as well.
31:31
So it's important to, I think, step back and define what's a vehicle.
31:35
Yeah, so so one thing that we skip and I think it's important from a context
31:40
perspective from the moment that we launched our insurance program took a very
31:45
different approach than I think anyone would typically take and the approach that
31:50
we've taken is we approve particular event organizers that put on events as opposed
31:56
to, uh, Approving or underwriting drivers, in other words, you know, you go through
32:00
a process of buying a policy from us.
32:03
We never asked for your driver's license number.
32:05
We're not checking on your driving history.
32:07
Honestly, we feel that the group that you're going to their event and he's
32:14
running the event as the passing rules as the instruction has the classroom
32:18
instruction, so on so forth is far more important in evaluating the risk
32:23
than uh, If you've had two DUIs 10 years ago, because at the end of the
32:28
day, you're, you know, if you're a beginner novice level driver, you're
32:32
going to have an instructor in the car.
32:34
And once you move up to the, you know, ranks where you don't have an instructor
32:38
in the car, you should have already passed all the quote tests of the prior
32:42
instructors to be able to drive solo.
32:43
So with that, yeah.
32:45
We only cover HPD and track day events for vehicles.
32:49
I've really wanted to and looked into doing motorcycle track days.
32:54
Honestly, as I've, as I've kind of looked at the market, I've found that
32:58
the majority of motorcycle track day type guys that I've talked to, Are
33:03
not really that concerned about the financial loss, but they feel like
33:08
if they lay over the bike, and yeah, I'll answer your question in a moment.
33:12
But the feedback I've gotten is if they lay over their bike, you know,
33:15
most of the stuff's relatively small.
33:18
The big 1 is, you know, you've been a fork and all of a sudden it's
33:22
totaled or, or very, very expensive.
33:24
But honestly, just kind of the feedback that we got was there's not enough.
33:29
Interest or demand on that side to offer it.
33:32
I want to answer your question, but to answer the prior part of the question,
33:36
you know, production based vehicle.
33:38
No problem.
33:39
Production based vehicle turned into a track car.
33:42
No problem.
33:42
Production car turned into a full race car.
33:45
Not licensed.
33:46
No problem.
33:47
Purpose built type race car or vehicle used in HPD and track day events.
33:54
No problem.
33:54
Whether it's, you know, uh, something like a spec race or Ford, uh, Formula car.
34:00
Yeah, we both have the same thought there.
34:01
Um, so, so any of that stuff, uh, no problem at all.
34:05
Uh, snowmobiles, no, uh, because we don't approve any HPD organizers
34:09
that allow snowmobiles, but so, so essentially any vehicle that the event
34:14
organizers allow, and I'd say, you know, there's probably less than five
34:19
percent of event organizers that we've reviewed that we haven't approved.
34:23
Okay, so this is, this is a really good segue because now
34:26
we define what a vehicle is.
34:27
So now we have to define what a track is, and you brought
34:30
up about HPDE specifically.
34:32
And so I've been thinking about this, and I think HPDE has grown over the
34:38
years, because you could make an argument that when the motorcycles are on track
34:43
and they're doing their school to get the novice riders, they're in a DE.
34:47
For instance, if you go to Tim O'Neill and they do their their ice racing up there
34:51
and off road rally stuff, You're in a D E.
34:54
If I go to do a lead following formula cars, right?
34:57
For training, I'm in a D E there's many ways to define D E.
35:01
It doesn't, it's not just grounded in production cars.
35:05
So I wanted to kind of just separate there to figure out like, how are
35:08
you guys defining what is a track?
35:10
Because there's, there's educational aspects to off roading, there's
35:14
educational aspects to rally cross, there's educational aspects to auto cross.
35:18
So you could say that all of those are high performance.
35:22
Driver's education, because none of it relates to the street.
35:25
It's all high performance driving.
35:27
So how do you guys deal with that?
35:29
Yeah.
35:29
So I'd say we don't have too many, I don't know what I'd say.
35:35
Non traditional tracks that are eligible for HPD insurance, New York safety track.
35:41
If you're familiar with that as one that's on our approved list, that in a lot of
35:45
ways, it doesn't kind of look like your typical racetrack there's, um, Oh gosh,
35:50
there's one in North Carolina that's kind of a training type facility that we cover.
35:55
Yes.
35:56
Yep.
35:57
That's kind of a non traditional one.
35:58
You know, the O'Neill's of the world or Dirt Fish is an example
36:02
in the Northwest, a rally school.
36:04
Those, for the most part, the vast majority of the activity that occurs
36:09
there is in their own vehicles.
36:10
They've got kind of their own self insured programs that they
36:13
utilize to, you know, Cover those.
36:15
I'd say that's something that we could do.
36:17
It's just not really an opportunity that's presented itself as an asterisk.
36:21
Their Audi club back the old days when it was the quattro club and
36:26
based out of like, Minnesota and stuff like that, they would do, they
36:29
would do ice racing like with it.
36:31
People would bring their cars like they're going to the track and
36:33
they would go race in the snow and on a frozen lake somewhere.
36:37
So again, and I know that's still very popular in North Central, you
36:40
know, we'll call it Southern Canada, uh, to do that type of racing.
36:44
Right.
36:45
So again, to me, it's, it seems like there's more.
36:48
To what D E is, then what we just know on circuit racing.
36:52
Yeah.
36:53
Yeah.
36:53
Um, you know, one that I don't know, you know, we, we should get more
36:57
interest on this than, than we have.
36:59
We, we do offer autocross insurance.
37:01
It's actually sold as kind of a.
37:04
A bolt on to our off track insurance policy.
37:07
You don't have to have a non licensed vehicle to get the
37:10
autocross part of the coverage.
37:11
So but it again, I I think it's dirt cheap, you know, like a 30, 000 car for
37:18
season long annual coverage unlimited number of events is like 300 bucks.
37:22
So it's it's pretty darn cheap.
37:24
It's counter to what I shared with you about.
37:26
Why don't we just do the unlimited annual policy on HPD policies?
37:31
The the big difference there is outside of cones You've got your odd light pole
37:35
here and there if the the course was not designed quite right or you had a
37:38
you know Kind of unforeseen catastrophic failure that sent you to a curb.
37:44
But, you know, the damage that we've seen occur in autocross is from all the kind
37:49
of intelligence that we've gathered of autocross incidents tells us that the
37:53
frequency is extremely, extremely low.
37:56
And my personal experience has that as well.
37:58
RallyCross is an interesting one.
37:59
RallyCross is frankly one that, that honestly I've overlooked.
38:03
It's been.
38:04
Building really, really, really quickly.
38:07
And, you know, I think it's one that we probably should take a harder look at.
38:11
I will say my handful of buddies that do rally cross seem to not be phased
38:17
by any sort of damage that occurs.
38:20
Um, they just, you know, tend to be the types of guys that, you
38:23
know, they bang this little thing up or this little thing up here.
38:26
I don't know.
38:27
For whatever reason, all my rallycross buddies are, you know, very much guys
38:30
that would never buy an insurance policy.
38:31
We're just going to roll up our sleeves and fix it.
38:34
We call that the send it mentality.
38:36
Yeah, exactly.
38:39
And, and to touch on that point as well, I think the off road market and the off
38:43
road courses and stuff like that is an untapped market because there are a lot
38:47
of 60, 70, 80, 000 jeeps and off road rigs out there that break all the time.
38:54
Well, look at Roush Creek.
38:55
I mean, they have a whole educational program behind off roading.
38:58
It's a cross between track DE and autocross because they got to do one,
39:03
one truck at a time type of deal.
39:04
But yeah, if a tree falls in the forest and it landed on
39:07
your truck, what happens next?
39:08
Right.
39:09
So, but again, it's on all under the guise of education.
39:13
And, you know, I think Again, when programs were built, let's
39:17
say 20 years ago, there was D.
39:19
E.
39:20
and not a whole lot of anything else.
39:22
And the guys that went vintage racing and the guys that went rally cross, it was,
39:25
you know, a bunch of buddies in the six pack and they went driving in the woods
39:28
and they didn't tell anybody about it.
39:29
But now.
39:30
We have a lot of sanctioned events and we're fortunate.
39:33
You're talking about rally cross in the DMV that, you know, summit point is back
39:37
hosting rally cross for the WDCR CCA now, and that's got a huge draw, right?
39:42
So again, it's right there on compound.
39:44
You cross the gates of the summit point motorsports complex.
39:48
You're again, does the track insurance cover me at that point?
39:50
Because I am on property.
39:52
I am doing, it's not like I'm on my buddy's farm, you know, but we don't need
39:55
to belabor the point, but it is definitely something that people should think about.
39:59
And, you know, what can I cover?
40:01
How could it be covered?
40:03
Does locked in cover me?
40:04
You know, these are the questions you should be asking yourself as we have
40:06
multidiscipline listeners out there.
40:09
It's a great point.
40:10
You got me thinking a lot.
40:11
And I think rally crosses, uh, is one that, that we need
40:15
to take a harder look at.
40:16
All right, let's move forward a little bit and let's talk about after the
40:20
oops moment, after you've thrown the flag, you've had your code brown, how
40:25
does this whole claims process work?
40:28
Yeah, unfortunately, you, uh, one, need to go to our website, you fill
40:33
out an incident report form, kind of, uh, going through the painful details
40:36
of what happened, so on and so forth.
40:39
The only kind of additional required documentation needed at claim time.
40:44
Is a report from the event organizer that the, you know, about the incident.
40:50
And, and this is purely, you know, it kind of acts like a police report
40:54
does for your accident on the street, just as confirmation to the insurance
40:59
company that here's what happened.
41:01
And from our perspective, it's that this incident did occur on the track.
41:05
And we tried to collect some good and helpful details of.
41:09
Gosh, we're having a whole lot of claims that, uh, whatever uphill us is to add V.
41:14
I.
41:14
R.
41:14
Um, is there, you know, we've seen a big wave of them recently that there's some
41:18
sort of pavement issue that, you know, should be addressed with track management.
41:22
Um, I'm just making up something there, but, you know, a number of
41:26
different things, but main thing is that it's confirming the incident
41:28
occurred at the event that you said that you were at past that you take the
41:34
vehicle to or have the vehicle towed.
41:37
To the, to the shop of your choice, we do not take the typical Geico progressive
41:43
state farm, whatever giant insurance company name you want to use, where there
41:48
are particular approved repair facilities.
41:51
We find that, you know, most track guys have a certain shop that they're
41:56
comfortable with, or they know who they want to take their vehicle to.
41:59
And honestly.
42:00
They probably have a better idea of who's more familiar with their
42:03
car in their area than we do.
42:05
So, uh, you take the car to shop of your choice.
42:08
A jester comes out pretty quickly at that point to do an inspection of the vehicle.
42:13
And their real job there at that point is to just get like a real baseline on
42:19
You know, what parts of the car damaged, you know, just trying to get the very
42:23
basics together of what parts would, you know, most likely be needed, what sort
42:28
of labor would most likely be needed.
42:30
Then they work with the body shop to, you know, essentially
42:33
come up with the estimate.
42:34
The adjuster is, you know, their information that they're collecting
42:37
is really just to keep the body shop and check the repair facility and
42:41
check to make sure that they're not.
42:42
You know, at that point, the insurance adjuster is then in touch with you, the
42:50
person that got in the accident to, you know, talk about where you move forward.
42:53
If it's a smaller dollar claim, pretty straightforward.
42:57
It's getting the, the repair invoice approved and moving forward with
43:02
that, you know, as it approaches and it depends on the cars, it approaches
43:06
60, 70, 80, 90 percent of the value of the vehicle to repair it.
43:11
That's when they start looking at, hey, what's the salvage value of this thing?
43:15
Does it make more financial sense to total the car if essentially repair
43:19
costs plus salvage costs are going to exceed the value of the vehicle?
43:24
The question about the adjusters, are they just, you know, regular old adjuster?
43:28
Are these handpicked people that know cars and know race cars a
43:32
little bit better that you can actually have a conversation with?
43:34
I think some of our listeners would be at ease to know that, hey, The guy
43:37
that's going to come out, if I tell them it's got this, this, and this,
43:40
or it's built like that, or, you know, whatever was done, they might actually
43:43
understand what was going on, right?
43:45
Yeah.
43:46
So, so there's, there's kind of two sides of this.
43:49
One is the primary adjuster that's, that's, you know, really technically
43:54
titled the claim representative, which everyone calls everyone adjusters
43:59
that's involved with the claim.
44:00
And so the claim representative.
44:02
Deals with track guys all day every day.
44:05
Uh, that's that's the claims that they have Uh that the claim representative
44:11
team Has a number of adjusters that they work with given, you know The you
44:16
know wide geographies the whole united states that we provide insurance for
44:21
There are, you know, different adjusters in different regions of the country.
44:25
We have found and developed some that are, you know, more familiar with race
44:29
cars over time, but I'll be honest with you, you know, there are certain
44:33
segments and parts of the country or John, who's our normal guy in Florida.
44:37
is on vacation.
44:38
It's not always going to be someone who knows the cars in and out.
44:41
But the key is the claim representative, who is really the guy that makes the
44:46
ultimate call on the repair invoice being approved, all the ins and outs
44:52
of actually processing the claim.
44:55
Those guys actually deal with track guys all day, every day.
44:58
So they've got a good familiarity.
45:00
Are Going to be as knowledgeable about your car as you are.
45:04
No, but, but they can kind of speak the same language.
45:07
So, so let me throw a use case out there.
45:08
And it's, I think it's, it's not a special one in the sense, but I think
45:12
it's one, it's probably pretty common.
45:13
So let's just use Brad's car.
45:15
As an example, we got this GTI really isn't worth a whole lot because you can
45:19
buy one off the street for two grand.
45:21
Right?
45:21
So his value is all in the parts.
45:23
It's all in the labor.
45:24
It's all in the setup.
45:25
So say he hits a wall, bends the frame.
45:29
Autobody shop goes, that's a 2, 000 GTI from 20 years ago.
45:33
Total it be done with it.
45:34
Right.
45:34
I'm not, it's not even worth straightening out right there.
45:37
You have the split second where you go, well, let's just say it hit, but
45:41
really didn't break major components.
45:44
Trans is good.
45:45
Motor's good.
45:46
Suspension's good.
45:47
Wheels are good.
45:47
Yeah.
45:48
Or maybe it made a side impact with another car or something like that,
45:50
where you can still salvage a majority of it, but I don't want the chassis.
45:54
Right.
45:55
So can I go in and say, let me strip it.
45:58
Because I'm going to get another donor for two grand on my own.
46:01
After the payout, you take the carcass, I keep my parts.
46:04
Is that a scenario, a real scenario that could play out?
46:08
I'd like that, but unfortunately, no, um, you you're going to have to total off,
46:13
let's say Brad insured it for 15 grand.
46:16
Uh, you mentioned that number earlier, so I'm just going to use that number.
46:19
Uh, you insured it for 15 grand.
46:21
They look at it.
46:22
No way.
46:23
We're going to be able to salvage this thing Your buyback on that thing
46:26
is probably going to be like 500 or a thousand bucks So you're going to
46:29
take 15 000 minus deductible minus 500 bucks You're going to buy it back.
46:33
The only expense that you're going to take on is once you get the car script
46:37
You're going to have to tow it to the scrapyard or pay someone to pick it up to
46:41
take to the scrapyard And you know what?
46:43
You'll get a little bit of money back when you take it to the scrapyard for the, for
46:46
the, for the, you know, metal scrap value.
46:47
So that's true.
46:49
So you mentioned guys anyway, so you've brought up this infamous term deductible.
46:55
So how high are the deductibles on these policies?
46:58
So we offer a 10 percent deductible and a 15 percent deductible option to be clear.
47:05
Most people get this, but, but I would like to specify that
47:07
deductible is based on the value of the vehicle, not the value, not
47:11
the amount of damage that you have.
47:12
Scenario would be 30, 000 car, 10 percent deductible selected, 3, 000
47:18
deductible applies, not, if you had a 10, 000 claim, it's a 1, 000 deductible.
47:24
Uh, there is a minimum that applies, and, I want to say the 10%.
47:30
It says on our website, so I'm going to put the disclaimer that
47:32
what our website says is right.
47:35
I want to say it's 2, 000 minimum and there is no maximum.
47:39
So.
47:40
So if it's 10 percent on a 2, 000 minimum, you're at least
47:44
insuring the car for 20 grand.
47:45
Yeah, um, you theoretically can insure the vehicle for 15, 000 and
47:51
you will pay a lower rate but your deductible is still going to be 2, 000.
47:55
Okay, interesting.
47:56
So if you've got a car where it's in that 15, 000 to 20, 000 range
48:01
and you're questioning whether you should insure all your modifications.
48:04
Probably worthwhile to kind of think through that cost benefit analysis of
48:08
well, I'm still going to play it, pay the 2, 000 deductible, but the difference in
48:12
premium is X something to think about.
48:14
So let's flip the coin the other way now, because I mean, I, I get, I get
48:18
hyper focused on, you know, untagged cars that you can walk away from as, as
48:23
Brad talked about in the intro, because I haven't driven a tagged car on track
48:27
for many, many years and much because A, I've grown out of it and B, I was
48:31
convinced that that wasn't the way to go.
48:33
You know, if you have a car that Brad said in the intro, if you're that
48:36
attached to it, it's that expensive.
48:38
It's maybe it's not the car to go to the track with.
48:40
And one of our members always says, if I can't walk up and put a boot in your door,
48:43
you brought the wrong car to the track.
48:45
Right.
48:45
But all kidding aside.
48:47
Let's flip the coin and talk about a car that was on the street.
48:50
Now, from what you described, it sounds like once everything is said and done,
48:55
you know, determining the claims process, the adjuster comes out, that all sounds
48:58
very normal, like a, like a standard insurance policy and the work gets done
49:02
in a body shop or whoever you take it to.
49:04
However.
49:05
Your standard automobile insurance policy is still kind
49:08
of sitting in the background.
49:09
And if you've got Geico or Allstate or Progressive, wherever you haven't reported
49:14
it to them, which you shouldn't because you're filing it through track insurance.
49:17
But what happens in that process?
49:19
Does the auto body shop, you know, some of them are required
49:22
to let's say updated car facts.
49:24
Now, all of a sudden your car is reported to being an accident.
49:27
Your standard insurance company might go back and look at that and
49:29
see that and things don't line up.
49:31
It gets really crazy.
49:32
It would be good to talk about that for the listeners out there that
49:35
still have cars with tags on them.
49:36
You know, first things first, I'm not going to say there is never
49:41
any possibility of this, but I've yet to experience and we've had.
49:47
Thousands of claims over the years.
49:49
We have never had a situation where person that was driving a street license vehicle
49:54
had a claim and it either a somehow hit their driving record because it wouldn't
49:59
be a, you know, unlawful type situation.
50:02
That's on private property.
50:03
You wrecked your car.
50:04
It's not like, uh, You get a ticket from the police that
50:06
would hit your driving record.
50:07
So I think that one's kind of obvious, but I've been asked it, uh, one
50:11
and then two, the, uh, I've yet to encounter a situation and I'm sure I
50:17
would have heard of it where it was reported or caught by any personal
50:22
insurers to hurt you on your insurance rates, on your personal auto policy.
50:28
In other words, that you had a claim under our policy and then somehow it, Hit
50:32
whatever system that Geico and Progressive and all the the big street auto insurers
50:37
fall from and then you pay the consequence on that side from their perspective.
50:41
Think about it.
50:42
This is not something that affected them.
50:45
So, you know, why?
50:47
Why would they look to increase your rates on the Carfax side?
50:51
You know, it all depends on what the body shop does.
50:54
I do think the majority of them, uh, with the tracking systems
50:58
that they utilize, you know, report to some standard databases.
51:02
So I don't think you're going to sidetrack the Carfaxman, you know, showing the
51:07
damage that occurred to the vehicle.
51:09
feel worse if they didn't report it because now you have an unreported
51:13
accident on the vehicle, right?
51:14
And then the next owner, let's say you turn it in, you trade it into
51:17
the dealer, car max, or some guy buys it privately, the car's been in a
51:21
wreck and he has no records of it.
51:23
Right?
51:24
But it also makes me wonder because the insurance, the major insurance
51:27
companies do keep track of.
51:30
Zero fault accidents.
51:31
Let's say you skid off the road and hit a tree or, you know, whatever.
51:35
But let's say it was an incident on track where two newbies hit each other.
51:39
You know, some guy ran out of brakes, plowed into the back
51:42
of you and rear ended the car.
51:43
I mean, that's the guy that hit you is at fault.
51:46
Let's just say in the normal world, he would be at fault.
51:49
Your car, you didn't it, but you were hit by another vehicle.
51:52
So in the standard Insurance world.
51:55
It's an accident like any other accident.
51:57
Didn't matter where it occurred.
51:59
So somewhere along the line that has to get filed away.
52:01
You can't just kind of dismiss it and say, well, you know,
52:04
Geico doesn't care about it.
52:06
So how does that all play out?
52:07
Or it just maybe it does.
52:09
Maybe it doesn't.
52:10
So, so I'd say the, the track insurance world and the street insurance
52:15
world are just so far separated.
52:18
I don't see any ways that they interact.
52:19
So, but the focus on the track insurance world, and I can speak
52:23
to the approach that we've taken.
52:24
It's different than the traditional auto insurance market where.
52:28
You have that one claim, nowadays you've got certain companies that advertise
52:32
different, but, you know, it used to always be, you had a claim, you
52:36
see, you know, a 10, 15, 20 percent increase at your next renewal, that
52:41
was pretty much kind of standard fare.
52:43
We've taken the approach really since the beginning that you have that
52:47
first incident, just to be 100 percent clear, no rate increase, no change in
52:52
eligibility, you can still buy policies that cost you the same as everyone else.
52:56
No hoops to jump through.
52:57
It's just, it is what it was before.
53:00
If you have a second claim within a three year period, technically you're
53:04
not eligible for our insurance.
53:06
You have to commit insurance fraud to do that.
53:09
We have a question that we ask that says, have you had more than
53:12
one claim in three years with us?
53:14
So if you lie on that, you could buy a policy, but it would
53:17
probably catch up with you.
53:18
We have had to make, I think only two.
53:21
Exceptions over the years to, you know, provide documentation to someone that
53:27
they can answer that question that they haven't had more than one claim,
53:32
essentially two claims or more because of a situation like you mentioned, where.
53:36
You know, they, they were at, uh, involved in an incident where they were not at
53:40
fault, something along those lines.
53:42
So we'd essentially, we handled those on a case by case basis.
53:45
But if we run into a serial incident, have her, um, in that situation, you
53:52
know, they just become ineligible if they've had two claims in three years.
53:56
Once that three years is up, good to go again.
53:58
Does your system talk to some of your competitors to where They can see
54:03
if somebody's had a couple claims with you all in three years and they
54:08
can't get insurance through you, but maybe they can go to one of the
54:11
competitors like Hagerty or OpenTrack.
54:13
We're going or some of these other companies, do you all share information
54:18
among the other insurance companies?
54:19
There's nothing today.
54:21
I, you know, I'm not going to say it's never going to happen, but
54:26
it's, it's never a conversation that's occurred to my knowledge.
54:29
You know, I think what we're seeing here is like, we're talking about
54:32
maybe some trends too, right?
54:33
You were talking about drivers having repeat offenses and
54:35
you're, you're building patterns.
54:36
That's also part of insurance.
54:38
Like you mentioned, does it seem to be that turn five at
54:41
VIR is a high area for wrecks?
54:44
Maybe that's a problem with the track.
54:45
It's not a problem with the drivers, right?
54:46
There's a lot of things you can do from an analytics perspective to
54:50
really see what's going on there.
54:51
So there's a lot of number crunching going on, not just, you know, Hey, I
54:54
had a wreck and please Cut me a check.
54:56
So let's talk about trending in the DE world.
54:59
What are you, what are you seeing out there?
55:01
Um, are there certain cars that are maybe more prone to having claims than others?
55:06
Is it high horsepower?
55:07
Is it, is it Miata's?
55:08
What are we talking about?
55:10
I've seen more of a trend over the last handful of years toward more
55:15
newer, more higher horsepower vehicles.
55:17
For the longest time, it seemed like the instructor and advanced drivers
55:23
at Almost any event that I'd go to anywhere across the country, guys
55:28
used to always drive, you know, E36, M3s, 944s, Miatas, you know, it was
55:33
like the 10, 15, 20 year old cars.
55:36
And, you know, they very much viewed them as.
55:40
Not disposable, but to your earlier point, you know, cars that they
55:45
wouldn't be too worried about damage.
55:47
And gosh, you know, if I go to an HPDE event at CODA, Circuit of the
55:53
Americas in Austin, the instructor group is typically comprised of, you
55:58
know, 60, 70, 80%, you know, 9, GT3s, Cayman GT4s, so on and so forth.
56:06
And, and it's not everywhere in the country, but it's a lot of
56:09
parts of the country seems to be going more that direction.
56:13
You know, I'd say with higher horsepower, I've had a lot of concern that instant
56:17
frequency would go up as, you know, there, there are more high horsepower, faster
56:23
cars out there that people would get.
56:26
Over their head over their skis and more likely to have incidents.
56:30
I'd say instant frequency.
56:32
I haven't seen that big of a change.
56:34
The biggest trend that I've seen in this, you know, fortunately, we
56:39
haven't had to make read adjustments for a while, but I'm concerned that we
56:42
might have to sometime down the road.
56:44
The cost of repair vehicles is going up and up and up with these newer cars.
56:48
First kind of examples of that, that I saw Nissan GTRs with all the
56:53
electronical voodoo in that car.
56:55
And the number of sensors behind the bumper, you know, I think we had
56:59
had a claim when I say five, six, seven years ago, I'm probably off
57:03
on that where a GTR had a light.
57:05
Front end tap into a tire wall didn't look like that much damage, but all the sensors
57:11
that they, you know, damaged on the front of the car made it like a 25, 000 loss.
57:16
Uh, you know, something that 10 years ago, if you would have shown
57:19
something like that to me, I would have said, eh, two grand, three
57:23
grand bumper cover paint done.
57:25
Not anymore.
57:26
There's so much more, especially, you know, the more exotic ends.
57:29
Uh, a lot more carbon fiber, even in the not so exotic end, a lot more
57:34
aluminum, a lot more airbag sensors, other sensors that can get damaged that
57:39
can really drive up the cost of claims.
57:40
So I'd say the biggest thing that I'm seeing is the hits are sometimes
57:44
harder because when you go faster and you have a mistake and have an
57:47
incident, you hit the wall harder.
57:49
Uh, so you've got that A and then B, it's just more expensive to fix newer cars.
57:55
Well, isn't that the joke?
57:56
Horsepower is how fast you hit the wall.
57:58
Torque is how far you push it.
58:00
I like that one.
58:00
Yep.
58:01
Yep.
58:02
Is there anything in the policy, talking about newer cars, newer
58:04
cars are just laden with nannies.
58:07
Is there anything to say that, well, you're at a DE and you shouldn't have
58:12
touched that little red button that all of a sudden put it in air incentive mode.
58:16
And that's the reason you wrecked.
58:17
So is there anything there that that would mitigate the coverage
58:21
to say, well, you did something you weren't supposed to, because you
58:24
shouldn't be in full on track mode.
58:25
If you're at a D E I totally understand.
58:28
Um, you know, that's, that's a balance I'd say if the insurance company.
58:33
So I think I'd.
58:34
kind of alluded to this, but just to be clear, we are the insurance
58:37
broker and program administrator.
58:39
So basically, the insurance company that we work with, AIX, a division
58:43
of Hanover, Hey, you guys know what you're doing in this space.
58:46
You administer the program.
58:48
We'll have a third party that would, you know, adjust the
58:51
claims, but essentially day to day operation of the insurance program.
58:54
You guys run it because you know what you're doing.
58:56
But they will review the results of the insurance program and the profitability
59:02
of it is, you know, are we losing money?
59:04
And some years they do lose money.
59:05
Some years they make money, you know, left to their own devices.
59:08
Sure.
59:09
They would put stipulations that you had to have all nannies
59:12
on, uh, so on and so forth.
59:14
That's kind of part of what we being on the consumer side of, of
59:18
Protecting our clients and looking out for their best interest fight.
59:22
Same time.
59:23
I've had that exact thought across my mind a number of times, and a lot of it's
59:27
through direct interaction with students that inevitably, uh, you know, that
59:32
first time or second timer out on track really, really wants to turn the nannies
59:36
off and I'll go ahead and give it to them at the slowest corner where there's
59:41
nothing to hit off track and tell them I'm going to turn it off at that corner.
59:45
And the first time.
59:47
80 percent of the time they spin it as soon as they, uh, you
59:49
know, uh, get it, get on the gas.
59:51
So I, you know, I do think the higher horsepower cars, I'd really encourage
59:56
outside of insurance just for, you know, learning and developing and, you
1:00:03
know, your safety I'd recommend until you're a high level, intermediate,
1:00:08
close to advanced driver, leaving that those nannies on use the lights
1:00:13
that flash up on, on the dash as an indicator that you've Exceeded some
1:00:18
limits in some ways and slowly over time start turning some of those off.
1:00:22
It seems to me like you guys are adhering to the principle of keeping it simple
1:00:26
because the more you start getting into adding writers about or disclaimers
1:00:30
about you've had, you have to have this nanny on or this, then you've got to take
1:00:34
into account the driver's experience.
1:00:36
And then you're underwriting the driver as well as the car.
1:00:39
And I think your approach works best for, I guess this situation,
1:00:43
declare your value, you know, we'll trust you to a certain extent.
1:00:47
We'll take care of it.
1:00:48
Whatever happens, happens.
1:00:49
Yeah.
1:00:50
Yeah.
1:00:50
We've very much taken that approach.
1:00:51
I mean, uh, you know, the reality of this type of insurance program in the
1:00:56
world in which I operate, never dreamed I'd end up in insurance, but at least
1:00:59
I get to do it with motor sports.
1:01:00
So it's kind of fun, you know, the amount of red tape that there is
1:01:04
in the insurance world compliance that we have to deal with.
1:01:07
So on so forth, you know, we sell 500, 600 policies to some higher
1:01:11
value cars, but we saw a lot of.
1:01:13
200 policies.
1:01:15
And frankly, if we didn't take the keep it simple approach from
1:01:19
an administrative perspective and controls and underwriting perspective,
1:01:23
frankly, we wouldn't be in this business because we'd be losing money.
1:01:26
So, so we, we've got to find efficient ways with proper controls in place to
1:01:31
prevent fraud claims as an example.
1:01:34
So Ryan, this has been great up until now.
1:01:36
So what we've done is we actually polled our membership and a lot of our
1:01:39
VIPs and people on our mailing list.
1:01:41
So say, Hey, right into the show and ask your questions about track insurance.
1:01:46
We're going to have locked in on here and now's your chance to
1:01:48
get all those questions answered.
1:01:49
So we're going to kick off this Q and a session, and I'm going to start off
1:01:53
with an actual locked in customer who has gone through this whole process.
1:01:56
We wrote an article about him and his better half.
1:01:59
We'll call her that where they'd had an incident and they walked
1:02:01
us through the whole process.
1:02:02
It's on our website.
1:02:03
If anybody wants to look that up, go to gt motorsports.
1:02:06
org and search track insurance.
1:02:08
But John asks as a clarifying question.
1:02:11
What drivers are covered under the policy?
1:02:14
When I've called, I've been told that anyone that drives the car is
1:02:18
covered, but when registering an event in the policy on the website, I must
1:02:23
list drivers and I can only add two.
1:02:26
So, technically, as the policy is written, the policy covers the car.
1:02:31
We used to require individuals to list any drivers that we're going to drive the car.
1:02:38
As I mentioned, we changed our website, our application process a while ago.
1:02:43
To where the person buying the policy is obviously listing themselves as a driver.
1:02:48
And we do not require you to list any other drivers that
1:02:52
are going to drive the car.
1:02:54
I think that answers the question.
1:02:56
Again, it covers the car.
1:02:58
Alright, so we've got a question from our member Anthony.
1:03:02
It's about fire damage.
1:03:03
And Anthony asks, When is fire damage covered by track insurance?
1:03:07
He's heard that a car that catches fire is only covered if the fire happens
1:03:11
in connection with the collision.
1:03:13
So I'm going to try not to get insurance nerdy on you on
1:03:17
different types of policy forms.
1:03:19
I guess this would be like talking to LS engines versus coyote or whatever.
1:03:23
So traditional auto insurance policy.
1:03:25
For a collision type of claim to kick in the there has to be a collision to
1:03:32
cover like a fire damage situation.
1:03:34
Those things as an example, we from the outset, I wouldn't say we're the only
1:03:38
ones that do it this way, but I think there are some others out there that
1:03:43
My answer is not going to apply to you.
1:03:45
So whatever provider you're working with, I'd make sure you understand their stance.
1:03:48
Ours is, you know, a policy that covers, you know, various different
1:03:53
perils, perils being things that cause losses, such as fire, regardless of
1:04:00
triggering event like a collision.
1:04:02
Actually had two Lotus Elise's that are, uh, pretty well known for
1:04:08
having fuel related issues that can cause fire suddenly and, you know,
1:04:13
can very quickly toast one of those cars where it's no longer usable.
1:04:17
No collision involved work up or no issues there.
1:04:20
Andrew Bank, if you're listening, that's an important thing to remember.
1:04:24
So track insurance on your lease.
1:04:25
All right, but expanding that.
1:04:28
So, in the case of fire, flood, act of God, natural disaster, et cetera.
1:04:33
On any of the cars, but specifically cars that are non tagged because
1:04:37
they're not covered by a standard automobile insurance policy.
1:04:40
They would be covered on the trailer.
1:04:42
Like we talked about earlier.
1:04:43
So all those conditions, let's say you live in Louisiana and we get another
1:04:46
Katrina, your car's on the trailer, getting ready to go to NOLA, it should
1:04:49
be covered by the track insurance policy.
1:04:51
As long as, as long as you bought it for that particular time period or whatever.
1:04:55
Yeah.
1:04:55
Well, while it's at the track.
1:04:57
Yep.
1:04:57
Absolutely.
1:04:58
If you bought a HPDE track day insurance policy, if.
1:05:01
You bought the off track insurance, the, you know, trailer car, so on
1:05:06
coverage, it'd be covered in that situation away from the track as well.
1:05:10
So Anthony also expanded his question and he asks, if a car has a declared
1:05:16
value that is higher than Kelley Blue Book, And it is totaled.
1:05:19
What is the maximum payout?
1:05:21
Would it be the full declared value or the Kelly blue book value
1:05:25
plus the value of the replacement costs, modifications, et cetera.
1:05:28
So it's going to be the full declared value subject to some documentation
1:05:33
being provided on the value.
1:05:34
I've always used this as it's one that Kelly blue book does a
1:05:38
terrible job with e30 M threes.
1:05:40
So.
1:05:41
You know, your late eighties, early nineties and threes are pretty
1:05:44
notorious for being pretty drastically undervalued by Kelly blue book and
1:05:48
others out there, there's a ton of information that you can provide.
1:05:52
Uh, if, if Kelly blue book is way off on determining the base value of the vehicle,
1:05:56
multiple different ads, whether it's cars.
1:05:58
com, auto trader, whatever it might be, even though they're not even
1:06:01
sold cars, they're just list prices.
1:06:04
You can use documentation like that to account for the base value of the car.
1:06:08
You know, as far as we kind of covered the modifications, if it's less than
1:06:11
10, 000 in modifications, you don't have to provide any documentation.
1:06:15
If it's greater than 10, 000, you need to provide some receipts
1:06:19
and documentation on that.
1:06:20
So Mike asks how much personal liability insurance is provided when track
1:06:25
insurance for the vehicle is purchased.
1:06:27
There is 0 of liability coverage provided under our policy, and I'm
1:06:33
not aware of the of a traditional HPD insurance policy that does.
1:06:37
I've seen some supplemental liability policies that I've seen out there
1:06:43
that I'd encourage people to really read the fine print and really truly
1:06:48
understand what it is that they're doing.
1:06:50
You know, I'll tell you a lot of organizers out there Have pretty broad
1:06:56
policies that do a good job of not just protecting themselves, but they often
1:07:01
extend coverage to any participants, workers, officials, registrars, so
1:07:07
on, so forth, to where their liability policy as you sign up for their event
1:07:12
can extend to participants should they be named in some liability suit.
1:07:16
And a lot of the reason behind that is, you know, they've got overall
1:07:20
control and structure of the event.
1:07:22
They're the ones that are having you sign those waivers.
1:07:24
They've got all the risk management procedures in place.
1:07:27
And, you know, they're incented to protect individuals from suing
1:07:32
each other for what might occur.
1:07:34
So, I mean, there's everything from their liability coverage in
1:07:37
place, which is typically anywhere between 5 million and 10 million
1:07:41
per event in liability coverage.
1:07:43
And that's Usually dictated and required by the track.
1:07:46
And, uh, you know, from there, they typically also have something
1:07:50
referred to as participants accident insurance, and it's essentially
1:07:55
like a benefit that applies to any participants in the event where it
1:07:59
can kick in to cover medical expenses.
1:08:01
Or should there be accidental death or dismemberment?
1:08:05
There's a schedule will pay out for individuals that are harmed at an event.
1:08:10
So this is a really great topic, even though we kind of knew the answer
1:08:13
going into that was going to be zero.
1:08:14
It is an important thing to unpack because there's always one extra variable
1:08:18
in this that we kind of brought up early on, but we don't ever address.
1:08:23
And all three of us on this particular call are coaches, right?
1:08:26
Or instructors, depending on your vernacular.
1:08:28
And the coach is always innocent bystander in the right seat.
1:08:32
They're not covered by anything.
1:08:33
We're at a huge risk.
1:08:34
We're at a huge disadvantage, and we kind of go, I always joke that we go into it
1:08:39
like, you know, the cling on battle cry.
1:08:40
Like, today's a good day to die, right?
1:08:42
But in reality, there's really nothing covering the instructor.
1:08:45
So if something happens, the car's covered, you know, the guy's covered,
1:08:50
it's driving, you know, the whole liability thing with the track and the
1:08:53
waiver, it all applies to the driver.
1:08:55
Or the car, but never the coach, right?
1:08:57
And the coach is the odd, is the odd man out here.
1:09:00
So say you got two cars with track insurance, one hits the other,
1:09:03
they're taking care of each other.
1:09:04
But that door just came into my side of the car as a coach trying to
1:09:08
tell this guy, you know, what to do.
1:09:10
Where do we go from here?
1:09:12
So this is something I've been really involved with personal
1:09:14
interest as a instructor coach.
1:09:16
And you know, I've got a lot of friends that do the same thing and I want
1:09:20
to make sure they're protected too.
1:09:22
I will say this, you know, we probably.
1:09:25
And sure, 60 to 70 percent of HPD or track day events put on by event
1:09:32
organizers throughout the country.
1:09:34
And every client that we work with, we've tailored the policy for
1:09:39
HPD ease or track days, whatever, whatever term you want to use.
1:09:43
And the big thing that we've had to change is.
1:09:46
The motorsport insurers that operate in the world typically
1:09:50
have something referred to as a driver to driver exclusion.
1:09:54
It makes sense why they have it.
1:09:56
The driver to driver exclusion is put in place because, you know, what most
1:10:01
underwriters think of when they think of quote motorsports, they think oval
1:10:05
track racing, You know, John bumping into Jim and getting into each other
1:10:10
and, you know, trying to spin them, you know, before the finish to win the race.
1:10:14
Well, our HPDs don't look like that at all.
1:10:17
And the reason that they do those driver to driver exclusions is when John hits
1:10:22
Jim, they don't want the, you know, uh, Jim to be able to file a claim
1:10:26
against the event organizer to say, Hey, this happened under your watch.
1:10:30
Therefore, your liability policy should pay for damage to my car and
1:10:33
my injury and so on and so forth.
1:10:35
So what we've done for the HPD world is eliminate that driver to driver exclusion.
1:10:40
The key important aspect to that is if the driver to driver exclusion were in
1:10:46
place and you really have any incident involving the instructor being blamed
1:10:53
for something where he is a quote driver.
1:10:56
He's an instructor, but he's also a driver at the event.
1:10:59
Being sued by another driver.
1:11:01
Then it wouldn't be covered.
1:11:02
So striking that is critical and it makes, uh, that combined with we
1:11:08
write the policies in a way to where instructors are considered event
1:11:12
officials and event officials are treated just like an employee would
1:11:15
like, you know, if you're operating in your capacity as an employee for your
1:11:20
employer, should you do something wrong, the liability policy of your employer
1:11:24
kicks in to, you know, cover that off.
1:11:26
You have to be very careful of that in states like California,
1:11:29
because being an employee, right, it gets really, really dark and
1:11:33
dirty and very muddy at that point.
1:11:35
So I, you know, verbiage wise, you guys have got it all figured out.
1:11:39
But that that makes my ears perk up right in your particular use case.
1:11:43
This is really important.
1:11:44
And it hits close to home for a lot of the people that are listening
1:11:46
to this on the other side is that what you described is true.
1:11:51
But there's one more.
1:11:52
There's one more thing here.
1:11:53
I'm in the right seat, two cars collide, they're covering
1:11:56
track insurance, whatever.
1:11:58
Let's say the guy hits my side of the car hard enough, buckles the b pillar, and
1:12:02
now all of a sudden I'm being medevaced out, I need a new hip, and now I'm out
1:12:06
on PT, and yeah, granted, my disability will cover it and all that kind of
1:12:10
stuff, but I'm out of work for a while.
1:12:12
I got to do all these other kinds of things.
1:12:13
I got medical bills.
1:12:14
I wasn't expecting.
1:12:15
Yeah.
1:12:15
My medical insurance is going to go so far, but I'm still the odd man out.
1:12:19
And the guy driving the car just went home with a new Corvette
1:12:22
or a new Porsche because track insurance covered it for him.
1:12:24
So I hate to say at the end of the deal, the coaches are
1:12:27
getting the raw end of this.
1:12:29
So how, how do we fix this?
1:12:31
Yeah.
1:12:32
So, so that participant accident insurance I referenced earlier
1:12:36
applies to instructors just like it does any other participant.
1:12:39
You know, I'll tell you, there are some of these accident policies
1:12:42
where, you know, they're, they're doing the very bare minimum amount.
1:12:46
They've got 10, 000 in participant accident insurance that's available to
1:12:51
help cover medical expenses and so on.
1:12:52
There's some disability income as well.
1:12:54
It's very small in that type of situation.
1:12:57
Thank you.
1:12:57
That's one end of the spectrum.
1:12:59
The other end of the spectrum is there's event organizers that carry a million
1:13:02
dollars of participant accident insurance that in that exact situation that
1:13:07
you described, the medevac bill, the hospital bills, there's some disability
1:13:12
income included in there as well.
1:13:14
All of those could kick in.
1:13:16
So, you know, it's not something comfortable to ask,
1:13:20
uh, your event organizer, but.
1:13:22
At the same time, if you're volunteering your time to, you know, instruct
1:13:26
with this particular group, I think it's valid to bring that up to them.
1:13:30
Ask them what their participant accident insurance is and make sure
1:13:34
that you know and understand that.
1:13:36
And it might change who you're willing to coach or instruct for.
1:13:39
So that participant insurance does that also cover in the unfortunate incident?
1:13:44
We've seen this and it's less and less over the years, but it still happens
1:13:47
periodically where we lose a coach, right?
1:13:51
It was some of these events that are a little less.
1:13:54
Organized than others where we've lost a coach, do those participant
1:13:58
policies cover the family in case of death or anything like that?
1:14:02
So in that participant accident policy, there is a accidental death
1:14:08
and dismemberment portion of it, which, you know, basically any one who's
1:14:12
eligible, which would be instructors, coaches, participants, event officials,
1:14:15
corner workers, so on and so forth.
1:14:17
They are all covered and the accidental death benefit would be paid out in
1:14:22
the event that they make that claim.
1:14:24
Again, I'll say wide range here.
1:14:27
Uh, you'll find everything from 10, 000 of accidental death coverage to a million
1:14:32
dollars of accidental death coverage.
1:14:34
So it really, really depends on who the group is and what, what
1:14:40
insurance they've opted to buy.
1:14:41
And just for the, for the listeners, I know there are some
1:14:44
organizations that we run with.
1:14:46
SCCA is one in particular where they post.
1:14:49
Their insurance binder at the event.
1:14:52
So you can go through and you can read at least a summarized version of it.
1:14:56
I highly recommend that you read that next time.
1:14:58
You're in an event or if you're in another organizers event, ask them about it
1:15:03
and make sure you understand the policy because you need to protect yourself.
1:15:07
Absolutely.
1:15:08
And you need to know.
1:15:09
And that's where we're bringing this up because A lot of people might not
1:15:12
know in the case of an extreme accident or just, you know, a fender bender
1:15:15
on the track, whatever, that all of these things exist, people go there
1:15:18
and they're, they're kind of unaware.
1:15:20
So it's really good that we're talking about this, but you know, let's get kind
1:15:24
of back on track for lack of a better pun.
1:15:27
And I think this dovetails right back into where we were going.
1:15:30
And Brett and Anthony asked, does track insurance cover the driver's
1:15:35
liability for damage done to the track?
1:15:38
And the example is, will Lockton pay for a tire barrier, or wall repairs, or
1:15:44
any sort of track cleanup, which as we know, a lot of tracks have started doing.
1:15:48
I've seen it at VIR, I've seen it at Watkins Glen, you know, some of the
1:15:51
big name tracks, and there's big bills.
1:15:54
It's the most expensive kitty litter I've ever seen, right, or
1:15:56
some of the stories I've been told.
1:15:58
So how do we handle this situation?
1:16:01
There's a multiple kind of considerations here.
1:16:03
Um, I guess 1st things 1st, I'm kind of disappointed with the
1:16:07
way things went in this area.
1:16:09
I think for the longest time.
1:16:11
It was considered standard operating procedure if you owned a track, that
1:16:15
if there was oil spilled, you're going to have to put oil dry down.
1:16:17
If there was armco damage, you're going to have to, you know, repair armco.
1:16:21
If a tire wall gets destroyed, you're going to have to restack it.
1:16:25
There was a shift, I'd say about, 10 or 12 years ago, and I'm not going to
1:16:29
pick on the track, but maybe a track in the southeast that has immaculate
1:16:33
grounds that kind of started a trend that a lot of other tracks picked up on.
1:16:38
Our policy does include pollutant cleanup and removal.
1:16:43
Uh, there's a carve out for it and, you know, the oil dry, you know,
1:16:49
anything associated with a cleanup following an incident would be covered.
1:16:54
Granted, it's going to be subject to the deductible.
1:16:56
So if you just blow your oil pan off and dump eight quarts, you know, right
1:17:00
on the track and they send you a bill for that, but you didn't hit anything.
1:17:03
And it didn't, you know, the total damages, the kitty litter and
1:17:08
the costs associated with that didn't exceed your deductible.
1:17:10
It's not going to kick in.
1:17:12
We do not, and I'm not aware of anyone under HPD insurance policy, provide
1:17:18
coverage for other damage to the track.
1:17:22
If you damage arm code, get a bill for it.
1:17:24
If you, I've heard of maybe a track that will send people side bills.
1:17:29
If they go off sideways and, uh, uh, you know, really hurt the grass, uh, you
1:17:36
know, through their four wheel slide off track, that's not going to be covered.
1:17:39
You're, you're on your own on that side.
1:17:41
I would owe people a lot of money for going off track.
1:17:45
If that was the case, landscaping as a side business.
1:17:52
The next question comes from Brett, and he he's asking about competitive
1:17:55
events like time trials, club racing, things like that, which are often held.
1:18:01
DE events or in conjunction with DE events, you know, and we
1:18:04
talk about SCCA and NASA events.
1:18:06
They're often combined de and some sort of competitive aspect.
1:18:10
So, uh, time trial insurance.
1:18:12
We were the first ones to do that.
1:18:15
Gosh, I wanna say we did it three, four years ago.
1:18:17
Um, it's basically.
1:18:19
You go to the same spot to buy an HPDE insurance policy.
1:18:22
You fill out the same application.
1:18:24
There's just a button, a question that's required for you to answer.
1:18:28
Will you be participating in any time trial sessions?
1:18:32
If you click yes, you have coverage.
1:18:34
It's not a requirement.
1:18:34
Noted on your policy.
1:18:35
If you click no, you're not covered.
1:18:37
You don't have coverage for it.
1:18:38
It is an upcharge for time trial, as you probably would expect.
1:18:42
It's competition in nature.
1:18:44
So that's definitely available.
1:18:45
It's easy to get corporate side of things.
1:18:48
Um, we, we made an attempt to do that, uh, probably 3 or 4 years ago
1:18:56
and, you know, frankly, just did not get enough interest from the market.
1:19:00
A.
1:19:01
And B had some pretty high dollar claims that made it not very appealing
1:19:05
for the insurer to continue to do.
1:19:06
They tend to not like getting very little money and having to pay out
1:19:11
big substantial amounts of money.
1:19:13
And so that deal kind of fell apart.
1:19:14
I'd like to believe we could do it again down the road.
1:19:17
The challenge that we run into there is in the HPD insurance world, you
1:19:21
get a lot of beginners, people that are getting into this sport and HPD
1:19:26
insurance has been around for a while.
1:19:28
Uh, and before that, Street insurance policies used to cover you on track.
1:19:32
So different world versus in the race world, you know, most people
1:19:35
that have been racing for a while, they've come to terms with the fact
1:19:38
that if I wreck, wreck it, uh, if it gets destroyed, I got to fix it.
1:19:42
And I'm on the hook for it.
1:19:43
And you know, you throw it through a dollar amount out there.
1:19:46
You stick a thousand dollar policy in front of them and it's thousand
1:19:50
dollars for insurance versus.
1:19:53
1, 000 to upgrade this part of the car.
1:19:56
That makes me go faster and make me win more plastic trophies.
1:19:59
The plastic trophies tends to win.
1:20:01
All right.
1:20:01
Well, you know, that kind of wraps up our Q and a, a lot of the other questions
1:20:05
that were provided to us by our members were actually covered in the talk track
1:20:08
that we had earlier in this episode.
1:20:10
So I think we've done a really good job of exploring.
1:20:12
it.
1:20:14
But I want to give yo between you and some of t there that brad talked ab
1:20:24
open track, we won't list what makes locked in diff Yeah, I appreciate that.
1:20:31
Um, you know, I'd say probably more than anything is, you
1:20:33
know, involvement in the sports.
1:20:35
You know, I touched on it at the very beginning.
1:20:38
Uh, this is something I've done for a very, very long time.
1:20:41
I think, uh, we really revolutionized the HPD insurance offering.
1:20:47
And, you know, in a large part, you know, kind of played a role in the
1:20:50
sustainability of this industry.
1:20:52
Uh, there's a lot of people that without an insurance option, I don't think
1:20:56
would ever participate in the sport.
1:20:58
So, I think we've played a pretty important role for the industry.
1:21:02
And, you know, I think, The other big aspect that I'd, I'd mentioned is through
1:21:09
the involvement, I've got a high level of ownership and kind of protection
1:21:13
for, you know, my, my brothers and sisters that participate in the sport.
1:21:17
Um, I can't tell you how many times there's been a little claim issue here,
1:21:23
or maybe even a big claim issue where there was a little bit of a dispute where.
1:21:27
You know, I'm leading our motorsports practice, this division within Lockton
1:21:31
that I've built over the last 12 years, where, you know, I'll throw our weight
1:21:36
around with the insurance company and make sure that our clients come away, uh,
1:21:40
with, you know, what they expect, what's fair, what's right, so on and so forth.
1:21:44
So I'd say that for, for kind of the why Lockton side, the other components, and
1:21:48
we, I think, largely touched on this.
1:21:50
is event organizer insurance.
1:21:52
I think I mentioned we cover probably 60, 70 percent of HPD or track day events
1:21:58
out there, you know, there's two sides of this equation to the sport doing well.
1:22:03
It's one on the participant side, having participants that do events.
1:22:07
And I think insurance plays a role on that.
1:22:09
The other side is event organizers that are needed to put on events and
1:22:14
making sure that they're properly insured, that we're negotiating
1:22:17
with insurers that really recognize.
1:22:19
How much lower the risk is in an HPD event compared to that oval track
1:22:25
race, compared to that drag strip race, so on, so forth, that as we can have
1:22:31
influence and help them get the right insurance package at a lower cost,
1:22:36
it decreases their operating cost.
1:22:39
Helping them drive down participant costs, which helps them fill events,
1:22:43
which helps them be more profitable.
1:22:44
And it's this big circle.
1:22:46
And, you know, again, like insurance is, is a topic most people don't want
1:22:51
to talk about or don't like to think of as a good thing, but I think we've
1:22:55
been very effective at positively influencing this industry on both sides
1:22:59
of the equation to, to help it succeed.
1:23:02
And, you know, at the end of the day, I don't want to be a guy that sells
1:23:04
insurance, but I sure like being a guy that can try to help our industry.
1:23:09
Be more successful and sustainable in the longterm.
1:23:11
So Ryan, I think this has been an awesome conversation.
1:23:15
I have a whole new perspective on track insurance, you know?
1:23:18
And like you said, nobody's a fan of insurance, you know, like nobody's
1:23:22
the fan of the Spanish inquisition.
1:23:24
But I think in this case, for all of us that are in this particular
1:23:27
sport, this is more of a need to have than a nice to have.
1:23:31
And it makes complete sense.
1:23:32
And I think the package that you guys are offering is fantastic.
1:23:35
So for all of our listeners out there.
1:23:37
To learn more about Lockton's track insurance program, be sure to visit www.
1:23:43
LocktonMotorsports.
1:23:45
com or reach out to Ryan at rstaub at LocktonAffinity.
1:23:50
com.
1:23:50
R S T A U B at LocktonAffinity.
1:23:55
com.
1:23:55
So Ryan, I cannot thank you enough for coming on the show.
1:23:58
This has been absolutely fantastic and uh, looking forward to
1:24:02
seeing if you had a rally cross.
1:24:03
To the policy options there Sounds great.
1:24:06
Thank you guys.
1:24:07
Appreciate it.
1:24:08
Pleasure
1:24:13
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