With TULIP Ending, Brokers Can Fill Gap
Earlier this year, our partner One Beacon discontinued our Tenant Users Liability Insurance Policies (TULIP) program due to lack of business.
Although we developed this program for members to address the known exposures, it did not prove sustainable. We encourage members to adopt best practices when renting facilities to third parties for specific events.
It is essential to have a facility use agreement requiring renters to carry insurance. TULIP programs help renters obtain cost-effective insurance that meets the contractual obligations. For example, a couple may need general liability insurance to rent a venue for their wedding.
If they do not have the coverage needed, the TULIP program gets them the coverage for this one event. The facility sets up the TULIP, and the renters apply and pay the premium for each event. This is an important component of risk management in every organization.
We are evaluating our options to see if we can continue the program with a different carrier. Until then, there are options if you require that people renting your facility have coverage for their event.
First, if you have a broker, contact them to see if they have a similar program in place. Second, renters can reach out to their homeowners’ insurance carrier. Most insurance companies can add event liability coverage to their policy.
Work with your legal counsel to develop waivers appropriate for the activities involved. Remember, even if you don’t use a waiver to transfer the liability for an event, the risk is still there. It means that the district may be responsible if something goes awry.
We recommend you take a proactive approach by ensuring your renters obtain coverage.
Please make sure that in addition to general insurance provisions, your facility use agreements include:
- A requirement that the renter provide proof of coverage for each event, every time. If an event recurs, ensure they provide a certificate for each occasion.
- An express requirement that the renter obtain a liquor license for any alcohol served
- Further disclaimers of liability for a renter’s guests, especially related to alcohol
- A requirement that the renter inspect the facility prior to use
- A requirement that the renter clean up the facility after use. Also specify the consequences and fee schedule if they do not.
- If renter will hire catering or performers, require additional acknowledgment of vendor liability. In other words, require that any and all vendors carry insurance.
We are putting together a new TULIP program, but without support, members will have to find their own solution.
If you have questions about finding TULIP programs or drafting facility use agreements, please contact us.
