Many businesses sponsor little league baseball teams, football teams, and other youth sports activities with the belief that such a practice is good business sense. Sponsorship not only provides advertising for the business, but it also promotes public goodwill and fosters contacts that can lead to more customers. However, before a company rushes into sponsoring any youth athletic activities, there are issues to consider.

Specialty lines policies are available for businesses that sponsor youth athletics, as the standard commercial general liability policy simply does not have the protection in it to adequately cover all of the risk exposures.

In fact, the Insurance Services Office (ISO) has an endorsement, CG 21 01, that excludes coverage for bodily injury to any person while practicing for or participating in any sports or athletic contest or exhibition that the named insured sponsors. Insurers will attach this endorsement to the general liability policy of an insured business that sponsors athletic activities to prevent any coverage for injuries to athletic participants, like children or volunteer coaches. However, many businesses that are not insurance-savvy will sponsor youth athletic teams, thinking a general liability policy will provide adequate coverage for any damage or injuries that arise. Some exposures are covered, to be sure, but coverage gaps exist and this is something an insured business should know.