K&K Unveils New eSports Program

PRODUCT: eSports Program

COMPANY: K&K

BEST RATING: A+ (Superior)

AVAILABILITY: No prior appointment or agreement is necessary for agents to submit applications for a quote.

FOCUS: eSports—or online gaming—is becoming a multimillion-dollar industry, and underwriters at K&K noticed an uptick in requests for coverage over the past year.

Entrepreneurs are putting together teams of players age 18-35 and paying decent salaries to enter them into gaming competitions, whether they are playing sports games like basketball or soccer or video games like Halo or League of Legends.

“The sponsors of these teams are making money, and the sponsors were the ones who were initially contacting us, through their agent, looking for coverage for their teams and their exposures,” explains Scott Lunsford, senior vice president of K&K’s sports division. “And frankly, there’s not a lot of exposure. They’re sitting at a table with a monitor and a control set in front of them and playing video games.”

Lunsford notes that K&K brings the most to the table for eSports events, given the company’s experience in events coverage.

“They’ll sell out the Staples Center out in California, and they’ll have 50,000 spectators to watch kids play video games on huge monitors, and that’s right up our alley,” Lunsford says. “We insure events that have large crowds. Facilities are being built specifically for eSports activities, and that’s going to be good for our facilities division. We’ll write the property and the liability, and everything that goes along with insuring facilities.”

COVERAGE DETAILS: Available coverage includes sanctioned events, office premises, scheduled premises of the eSport team practices, participation in eSports competitions, promotional and marketing events, ceremonies, and other customary business operations of the insured team. K&K’s venues program also offers coverage for eSports facilities.

Coverage options for the eSports program include commercial general liability, directors & officers, property, inland marine, commercial auto, sexual abuse and molestation, crime, excess accident medical (participant accident), workers compensation, and excess liability. CGL and excess liability limits are $1 million and up to $25 million, respectively; higher limits may be available.

UNDERWRITING: K&K is in the process of redesigning an existing underwriting application to make it more specific to eSports.

“On the event side, we’re going to need to know the spectator attendance,” Lunsford says. “We’ll have to pull out ever-ready questions regarding the facilities, who’s responsible for maintenance, if there are concessions, who’s responsible for concessions. Parking is always an issue. Who’s responsible for the security for the event? Those will be the main questions.”

On the team side, K&K will also review the player contracts. “We’ll need to know what the housing arrangements are, if there are housing arrangements for players,” Lunsford says. “The contract should include player salary and the duration of the contract. Some of these are annual, some of them are six months. We’ll also need to know the shared responsibilities of the players—how much practice time they have to dedicate to their eSports.”

MINIMUM PREMIUM: $3,500.

TARGET: The program is designed for the unique needs of the promotion and operation of eSports teams during covered activities for U.S.-based team members, which can include housing and recreational amenities. U.S. residents are also covered while promoting and participating in eSports-related activities overseas on a temporary basis.

COVERAGE TERRITORY: The program is available in all U.S. states.

CONTACT: Scott Lunsford, senior vice president of K&K’s sports division.

Katie Butler is IA editor in chief.