Insuring Ghouls and Goblins

Halloween is just around the corner – and this is the peak season for haunted attractions across the country.

And amid all the fake blood and gore, insurance plays a critical part in protecting these businesses against lawsuits and bodily injury liability, property damage and even business interruption due to bad weather.

The most common type of liability claims is slip-and-fall accidents by visitors, according to Brett Lipton, president of N.Y.-based Castle Rock Insurance Agency. His clients include popular haunted attractions in New York, New Jersey and Pennsylvania. “October could be a wet month. So we are dealing with people walking on slippery surfaces. Staircases are also an issue,” he said. “And if ice starts to build up outside, that can create hazard as well.”

And even if visitors are required to sign a waiver, it would not hold up in court if someone gets injured because, say, there was a rock in the path and a person trips and falls – or if someone spills liquid and the staff fails to clean it up promptly and a person slips and falls.

Another industry expert, Robert Weber, who is president of Rain Protection Agency in Dix Hills, N.Y., also works with well-known haunted attractions, including the ever-popular Headless Horseman in New York’s Ulster County. Weber’s firm offers coverage for visitors’ bodily injury liability, property damage and business interruption coverage in case of rain. It also provides insurance for independent contractors who perform at haunted houses. Its carrier partners include W.R. Berkley, Chartis and United States Fire Insurance.

For liability coverage, per-season premiums can range from $350 to $25,000, Weber says, depending on factors such as the size of the attraction, the expected number of visitors, any claims history, and the length of time the attraction will be open for. Most haunted houses open for just a few weeks.

Also there are several additional factors insurers will look at. They include the type of the structure where the attraction will be held; and whether there are adequate safety features. Other considerations could include whether the attraction involves inflatables or tents; whether any food would be served; and whether there will be vehicular access to the premises. There could be dozens of exclusions, and one big thing insurers would like to avoid is open flames or pyrotechnics.

And this year, premium prices are stable, brokers said. “Rates are pretty stable. I don’t see them getting higher from last year,” according to Weber. He said most large attractions have strict safeguards in place. “Typically, there aren’t too many claims, and that’s why the premiums are usually low.”

Weber also mentioned that some owners simply forget about buying insurance and call his agency days after the opening. He told Insurance Journal, “I got a call from someone who said ‘Oh, I forgot about it. I was so busy preparing the haunts. I forgot all about the insurance.'”

A haunted house without insurance? That’s a scary thought.