Coverage Denied for Injury to Motorsports “Participant”

by

T.H.E. Insurance v. Cochran Motor Speedway (Georgia)
(Minor in the pit area of a racetrack deemed to be a participant; insurance coverage denied due to a participant exclusion.)

A stepfather and his minor daughter attended a racing event at the defendant’s racing facility.  The stepfather purchased pit passes for himself and the minor, and he signed a waiver and release from liability and indemnity agreement on their behalf.  The stepfather had some sort of affiliation with one of the racing team’s that happened to be crowned the winner of the local points championship on the evening in question.  The team decided to celebrate the championship by driving the racecar back onto the racetrack to the front straightaway.  The minor daughter was placed on top of the car and it began to drive onto the racetrack.  While it was moving, she fell from the car and was injured.  The minor daughter then filed a lawsuit against the racetrack, its owner, and the driver of the race car to recover for her personal injuries.  The racetrack submitted the claim to its insurance company, which denied coverage and filed a claim for declaratory relief.  Eventually, the plaintiff insurer filed a motion for summary judgment based upon exclusions in the policy, and the Court granted the motion.

The insurer had issued a commercial general liability policy to the racetrack, which included an exclusion specifically precluding coverage ““bodily injury or property damage to any participant against another participant while practicing for or participating in a racing program, which is sponsored by the Insured.”  The policy defined a participant to include: “individuals who have registered to and actually do engage in the racing activity provided under the INSURED’S PROGRAM-including drivers, mechanics, pitmen, race officials, flagmen, announcers, ambulance crews, newsmen, photographers, gate workers, and all other persons bearing duly and officially assigned credentials and/or guest pit passes for the program.”  There was no question that the race team and the man driving the race car onto the track were participants.  The only remaining question was whether the minor daughter riding on top of the race car was a participant as defined in the policy, and the Georgia District Court answered that inquiry in the affirmative.  The Court explained that the actions of the minor daughter  brought her “squarely within both the function and definition of a participant” because she had “engaged in the racing activity” and was “bearing a guest pit pass.”  Therefore, the Court found that the insurer had no duty to defend or indemnify the racetrack, its owner, or the driver of the race car at the time of the incident.

NOTE: This case illustrates the extreme importance attached to understanding one’s insurance coverage and making sure that the appropriate policies are in place.  Motorsports facilities should not only understand their basic coverage, but they should be intimately familiar with all applicable exclusions and the potential impact on their liability risks.  Certainly, an operation such as this should have ensured that participant accident coverage was included in its insurance package.  This case also exemplifies how a “participant” in a motorsports event can be defined quite broadly.  Such a broad definition can be beneficial from the perspective of a waiver and release and express assumption of the risk agreement, but could also potentially be detrimental as applied to insurance policy exclusions.

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