Making Sure your Commercial Insurance Coverage Generates Powder

Snow is a phenomenon enjoyed by children,  sports  enthusiasts, and many others but snow is essential to those industries that cater to snow sports enthusiasts.  In particular one profession stands out.  That is a snow grooming.  A snow groomer (a/k/a  a slope groomer) without a doubt needs a comprehensive commercial insurance package covering all of their heavy equipment.

So what is a snow groomer you might ask.  Wikipedia defines it as “a process of manipulating snow for recreational uses with a tractor, snowmobile, caterpillar, truck or snowcat towing specialized equipment. A snow groomer is usually employed to pack snow and improve skiing and snowboarding and snowmobile trail conditions.”

How did snow grooming get started?  According to the International Skiing Association the first snow grooming machine was an agricultural roller used at Mt. Cranmore to pack the snow followed by scarifying using chains and caulks to create a powder like base to ski on.  Steve Bradley, Manager of Winter Park, further refined snow grooming by working with Ed Taylor, the former chairman of the National Ski Patrol.

Presently snow grooming is generally performed using a snow groomer machine or a snowcat with a tiller and other attachments.  A winch cat is often used when the grooming takes place at a precarious location such as steep terrain.  The winch is used to stabilize the equipment.  This machinery is very heavy, enormous in size and expensive to purchase and maintain. Many models come with specialized navigation systems. A snow blower may also be used to even out the accumulation of snow in certain areas.

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Of course you cannot groom snow if there is no snow so making artificial snow falls to this occupation at times.

Snow groomer’s range from in house professionals at exclusive ski resorts worldwide to volunteers with a Trail Association. Trail grooming for snowmobiles usually falls under the purview of the Recreation Trails Program administered by the US Department of Transportation which generally follows the Guideline for Snowmobile Trail Groomer Operator Training– a Resource Guide for Trail Grooming Managers and Equipment Operators. Snow cat operator are required to take a course and become certified under OSHA standards.  This blog will focus on snow grooming  by snow cat operators for ski areas rather than snowmobile trails.

Snow groomers for ski resorts that offer a wide array of snow sports generally operate in 3 different ways:

1. Many ski resorts rely on their in house employee snow operators and supply their own equipment,or

2.  Resorts contract with snow grooming contractors who provide their own staff and equipment.  If so, the contract generally specifies the type of equipment to be used by the contractor.  As a result the contractor has a substantial investment in equipment alone including purchase cost, repairs, maintenance, and insurance, or

3. Resorts contract with a snow groomer where the snow contractor supplies only labor, fuel, and routine maintenance on the equipment which is owned by the ski resort, or the contractor may alternately be leasing the equipment from the ski resort.

Groomers may also contract to remove the snow from parking lots and pedestrian walkways at the resort common areas where no sports take place. They may need additional equipment in addition to grooming equipment such as a snow blower, snow melter, snow sweeper and snow shovel.

 Which type of contract you are operating under is essential to determine your insurance needs

If you are employed by a ski resort or lodge you are covered by their insurance. However, if you are an independent snow grooming company, you will need these types of insurance at a minimum:  commercial general liability, workers compensation for employees, commercial auto and commercial property.  The best option may be purchase a commercial package designed specifically for your company rather than a BOP which is for small to medium businesses.   You may need an endorsement or rider for your commercial property which covers the specialized snow grooming  and removal equipment, if you provide the equipment, and marine inland particularly if you transport the equipment on a regular basis to perform snow grooming at different locales.

If you have employees you need to be sure they have basic safety training which satisfies OSHA regulations. and that they have the level of experience necessary to perform that particular grooming activity.  You need to pay particular attention to safety of your workers and anticipate possible weather conditions that can cause injuries to workers and be proactive in establishing a safety plan and demand strict compliance with the plan.  See the OSHA Fact Sheets for guidance on dealing with extreme winter conditions.

Another consideration must be factored in if you operate at night to perform grooming after the slopes are closed. You may need large movable lighting sources and generators.  These also need to be specifically covered under the property coverage in your policy.

Due to the serious nature of injuries incurred when a person encounters snow grooming equipment many cases have found liability against a ski resort as the owner of the equipment being operated by an employee on the basis that the grooming  itself is unreasonably dangerous.  If you own your  own equipment and perform snow grooming under a contract you should consider purchasing excess liability and umbrella insurance. Two of the largest verdicts were for 8.3 million dollars and 11 million dollars.

Whether professional liability is required is a complex issue for all professions.  For snow groomers it is somewhat of quandary.  If you work for a ski resort as an employee than their insurance covers you but if you are operating your own company that is not the case.  In the past snow groomers did not necessarily  have  Errors and Omissions policies.  This  is an issue which is ripe for litigation.   You are in essence designing, packing and moving the snow to prepare areas for people to safely use for skiing, snowboarding,  slalom and operating snowmobiles. The courts have found this to be unreasonably dangerous activity when undertaken by a ski resort.  It stands to reason that if you perform this task it is still dangerous.  You are acting in the capacity of both a contractor and in a similar fashion to an architect or designer. Both the ski resort and the public  rely on your assessment of the safety and condition of the ski slopes. So  if you do make a mistake than an Errors and Omissions a/k/a Professional Liability policy can help cover  litigation expense and ensure the safety of your assets.

If your are also removing snow you need to keep abreast of all developments and regulations  regarding chemicals used and should have an environmental pollution policy.

While snow grooming is a very complex operation to run smoothly the joy one may experience while working in a frosty serene setting lighted by the moon and the stars is a pleasure most jobs don’t have at their work site.  Nor can you experience the beauty of looking out over the spectacular sight of freshly groomed fields of corduroy that you just molded in any other profession and have a feeling of accomplishment that goes with it.

 

2018 has already been a record year for snowfall throughout many parts of the United States and we are not through with winter yet. The ground hog has predicted 6 more weeks of winter. As a result, weather has caused a huge demand for snow removal generating a greater need for protection for the people doing this work. Snow plowing, just as many other industries, is in the midst of a technology revolution that is changing the business and how it is performed. And, those new methods are changing the nature of liability for snow plowers and others working in this industry.

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In the early years of the 20th Century, after the automobile were first mass produced, snow plowing was fairly straightforward. Individuals and companies attached a snow plow or shovel to their truck, or tractor, and went forth to do battle with the snow by either pushing it off the lot or street, or hauling it away to a vacant area where it could be left to melt.
Many snow removers did so on a part time basis or as seasonal work and continue to do so. However, the snow removal industry has evolved into big business due to changing transportation needs for roadways, airports, railroads, monorails, and truck and bus terminals. The military also had need for snow removers and innovations developed for the military found their way into commercial use. Regardless of whether you are a small business or a huge contractor, changes have and continue to come about which impact your insurance needs if you are in the snow removal business.

Your state will, in most cases, require that you obtain a CDL license and a business license to perform snow removal. You will need general commercial general liability insurance for those inevitable slip and fall instances where you may have liability. Your class codes on your commercial general liability insurance needs to reflect snow plowing even if you only perform this activity on a seasonal or part time basis.

You may also need to add an endorsements to your CGL for completed operations to cover accidental slips and fall on premises where you have completed the process of removing the snow and ice. You will also need to make sure your commercial auto policy reflects you are in the snow removal business. If you have employees you will need workers compensation. If the employees drive their own vehicles you will need non-owned commercial auto.
Other insurance should be considered based on the following factors:

1. New equipment has been designed and built for snow removal for specific industries ranging from simple walk behind snow blowers to massive high powered heavy duty equipment and vehicles.

Equipment now encompasses, snow blowers, dump trucks chassis with modifications, snow cats, snow rollers, de-icers, front end loaders, gritters, Snowgers (a type of auger used for removing snow under semi-trucks and busses) snow melters, plows and sweepers.
In the past an individual could use a personal truck and rely on their personal auto insurance coverage. Now your insurance can be voided if you do not reveal your using your personal truck for business and have commercial auto coverage or have a separate commercial auto policy specifically for snow plowing and/ or commercial equipment coverage. Businesses should have a separate commercial auto policy covering all their road worthy vehicles. Commercial equipment should be covered under your business property insurance with endorsements, riders or a specific policy for that item as well as marine inland insurance for those items which must be transported to a work site. If equipment or machinery is rented you need to have an endorsement or a floater covering those items.

2. New chemicals such as sodium chloride, magnesium chloride and calcium chloride are now used in the process of deicing and anti-icing which have environmental implications.

Many regulations are in place which prohibit snow removal residue from being dumped near to, or in a waterway. This means that a snow remover could be sued for environmental pollution of nearby waterways that become polluted thus necessitating that snow remover’s carry environmental pollution polices as this is an exclusion to a commercial general liability policy. Waterways have gotten a lot of attention but little research has been done regarding pollution of soil where snow is discarded and this may end up being an area ripe for pollution and litigation as well. While snow melting with various methods may not be as cost effective it may prove to be a better option in the long run.
Additionally, scientific research has shown that even older substances like road salt can disrupt circadian rhythms and destroy nearby aquatic ecosystems as well as raise the risk of many diseases. https://www.scientificamerican.com/article/can-road-salt-and-other-pollutants-disrupt-our-circadian-rhythms/
Gritting used to be a common practice on roads but is used less frequently due to environmental concerns and rusting of roadway infrastructure such as bridges. It is still used in clearing airports and runaways and sometimes in extreme temperature. This product could also lead to damages to cars and other vehicles from rusting if snow debris is pushed next to the car in lots or it is sprayed with a snow blower leading to a property damage claim. Salt water brine is sometimes used which is collected from conventional oil wells. It is thought that filtering the brine to a level comparable to safe drinking water with the exception of the salts in the water is safe; but the issue has not been adequately researched to be an established fact. Additionally, residue from other matter on the ground is swept up along with the snow and dumped which can cause pollution on its own.

As an additional precautionary note here, is that the Guidelines for the Selection of Snow and Ice Control Materials Section 3.10 prepared by Levelton Consultants, Ltd. for the National Cooperative Highway Research Program suggest that chemicals for deicing may be hazardous while in storage and during use and have a variety of toxicity attributes set out therein in Table 3-13 which may affect human health through ingestion, inhalation and dermal contract depending on the dosage and the particular concentration of the mixture in use. Litigation in environmental pollution is growing in all construction related industries and this may be one of the next targeted areas in pollution litigation.

3. New regulations are effecting liability issues as well.

The EPA has issued guidelines regarding collecting run off water from snow at airports, roadways and major establishments. Many states have issued guidelines as well. https://stormwater.pca.state.mn.us/index.php/environmental_impacts_of_road_salt_and_other_deicing_chemicals Deciding which chemical to use in the deicing process often depends on cost and environmental impact. Chloride ions in chemicals seem to be the major factor in deicing issues effecting waterways. Ethylene Glycol is also used in deicing airport runways. It is also being researched in regard to human toxicity from inhalation and dermal contact. Salt water brine from conventional well drilling is also being researched as an environmental hazard as it is used as a deicers. See ACRP Fact Sheet: Deicing Practices.

4. New Accreditation and Training.

As noted, most states in America require that snow removal operators have a commercial driver’s license and a business license. Although special education is not required it is available and snow removers can receive training accreditation through the Accredited Snow Contractors Association (ASCA) or the Snow and Ice Management Association (SIMA) and completion of an independent audit. To earn the designation you must comply with Industry Standards which are internationally accepted. When accredited you will have an ISO 9001 Certification SN 9001. Both of these entities proactively support the snow removal industry. Snowmagazineonline is also dedicated to this industry.
In a lawsuit, accreditation can be used in your defense to shore up credibility and adherence to professional standards. Some insurers may discount your rates when you are accredited.

5. New Safety Requirements for Employees Criteria

If you have employees you are required to carry workers compensation in most all states. But there are other considerations in regard to employee health. See the tips for Winter Storm: Plan Equip Train, US with suggestions for employees exposed to severe weather. https://www.osha.gov/dts/weather/winter_weather/hazards_precautions.html. Employers have a duty of care to employers and can be investigated and fined for workplace injuries and accidents.
If you are removing snow from buildings/ roofs fall hazards must be addressed specifically as well as slip and falls on the ice or snow on the ground. Training should be given on use of dangerous equipment and supervision of new or untrained employees. Particular attention should be paid to the snow load on any job and necessary precautions. A well designed training and safety plan can save you money on your worker’s compensation premiums.
You may also want to consider options that can protect your bottom line such as Income Stabilization coverage in the event of a mild winter in some areas or data entry and technology insurance to protect your records.
Finally, recent Legislation in Illinois and other states has been enacted seeking to limit snow contractor’s liability unless prefaced on their direct actions and fault. States vary as to whether they hold snow contractors directly liable for 3rd party injuries. This should result in less litigation but more efforts will be made to show the contractor’s action or omission as the cause of an injury in order to place liability on the contractor rather than the owner or landlord of the property in law suits that are filed.

All of these changes may mean that you need to reexamine your insurance needs, talk with your insurance agent or broker and obtain advice regarding your liability in the state you work in.