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Are Special Events Harmless?

By Kristin Withrow posted 10-12-2023 03:51 PM


By @Wendy Tucker  AU, SDRMA Member Services Manager

Does your district receive Use of Facility requests for weddings, parties, or to host a meeting? Does your district want to host your own event off-site? Is this covered under your insurance policy or does this require a separate special event policy?

“Special events” are typically one-time events outside the normal range of programs and activities. Many of the District’s hosted off-site events are likely covered under your general liability policy, but what about people or entities using district facilities? What additional risks may your district be taking on?

Read on for guidance on detecting your district’s vulnerabilities when allowing or hosting special events:

Facility Use Agreements

District as the Host – When renting off-site premises, most entities will require to be named as an additional insured and have specific insurance requirements. Read the agreement carefully and review with your insurance provider to determine if the event is covered under your existing policy or if a separate policy is needed. Depending on the size and type of activity, you may also want to check with your district’s legal counsel for any additional recommendations.

District as the Lessor - When allowing a member of the public or another entity to use district facilities, you should have an agreement in place requiring that the renter provide a certificate and endorsement naming the district as an additional insured. The insurance requirements in the agreement should be relevant to what the activity is. For example, if an entity is using a meeting room to host a public meeting, $1M in general liability limits may be appropriate. However, if an entity is using facilities for a wedding or party where they will be serving or selling alcohol, in addition to the general liability you will need to require liquor liability. If the renter does not have insurance, they can purchase “Special Event Coverage” that will cover their event. Creating a checklist to use in conjunction with the use of a facilities/rental application will aid in ensuring that all insurance and safety checks have been completed.

Selling or Serving Alcohol

District as the Host – Some events may include serving or selling alcohol. If the district is hosting an event and alcohol is served, check with your insurance provider to confirm how coverage applies. Any hired vendors will need to name the district as an additional insured for liability and liquor liability. Additional considerations may include:

  • Who will verify the age of the participants?
  • Is there be a safety plan in place in case of disorderly conduct?
  • Should security be provided?

District as the Lessor - If a renter is using the district’s facilities, the general liability certificate and endorsement needs to include host liquor liability insurance. If they will be selling alcohol, they need to have a valid liquor sales license and have liquor liability covering the sale of alcohol. Whether the district is hosting or allowing use of facilities to a renter, the links below provide important information regarding the CA ABC requirements (Alcoholic Beverage Control) as well as considerations for when security is required:

Outdoor Concerts/Markets/Parades

District as the Host - These types of events often involve street closures as well as multiple vendors, so consideration should be given to the potential risks. When hosting, whether on or off-site, the district should confirm with their insurance provider that no additional insurance is needed. The district should also require additional insured endorsements from any vendors and food trucks that include the appropriate coverage (i.e., liquor liability, general liability, auto liability, etc.). If the event includes closing off streets, be sure that an approved traffic safety plan is also in place.

District as the Lessor – If a renter is applying for use of facilities for this type of event, the use of facilities/rental agreement should include that any vendors used by the renter need to have the same insurance requirements as the renter. If the event has street closures, as noted above, a traffic safety plan should be in place. The California Manual on Uniform Traffic Control Devices  can be referenced for more information.

Bounce Houses

District as the Host – Bounce house rentals are common at outdoor events, and while the bounce house company is responsible for the set up and tear down, the district should still develop a best practices list to ensure the safety of the users. The bounce house company should provide the district with a certificate and endorsement naming the district as an additional insured. The district may also consider having participants sign waivers prior to using the bounce house.

District as the Lessor – Along with the additional insured certificate and endorsement for the event with the bounce house, having best practices and safety measures to provide to the renter would be beneficial. Examples of best practices include, but are not limited to:

  • Adult supervision of children is required at all times.
  • The bounce house must be staked to the ground.
  • If strong winds or thunderstorms arise, the bounce house will be immediately shut down.
  • Ensure power cords and other tripping hazards are minimized.

While the goal for special districts is to provide a public service and support public activities, it is vital to make certain that you are transferring the risk where appropriate. Having policies and procedures in place for rentals/events will ensure that your district is following consistent guidelines. It is also important to understand what the risks are before engaging in one-time events, whether you are hosting or allowing the event on district premises. By implementing and following policies, procedures, and safety checklists, you will create a culture of consistency and safety which will ultimately assist in reducing the district’s risk exposure and unintended consequences of allowing public events on your property. Talk with your risk manager and/or insurance provider to assist with the development of these important documents.

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