The CrossFit Risk Retention Group is designed to be the first line of defense for the entire CrossFit community.
The CrossFit Risk Retention Group is designed to be the first line of defense for the entire CrossFit community.
A. Policy limits are the maximum amounts of money that the RRG will pay on your behalf for a single incident. This payment includes both legal defense costs and any damages settlement agreed to. Unlike other insurers, the RRG will spend all of the money necessary to fight professional claims in order to avoid making settlements on cases that will set a negative precedent for the CrossFit community. The minimum limits for professional are $1 million per occurrence and $2 million aggregate. This is the amount required by CFHQ. Higher limits can be purchased for additional premium.
A. For affiliates, the minimum premium will continue to be your premium until your gross revenues exceed $250,000. Beyond that point, the premium will be an additional $4 for every $1,000 of gross revenue you earn. For trainers, the minimum is in effect up to $50,000 in revenues and begins to increase at the same $4 rate for every additional $1,000 in revenues. With a good claims history and high community participation, these rates will go down over time. Conversely, if we begin to have high claims rates, the premiums may go up. But, the initial premium rate is based on assumptions of much higher claims rates than we have experienced so far, so lower premiums in the future are likely.
A. No, under those conditions, your affiliate’s policy will cover you in the classes you teach on their behalf, even if you are a contractor rather than an employee.
A. Yes, there is premium financing available from an independent premium finance company that can be arranged for you through Nexo.
A. The $200 for trainers must be paid before a policy can be obtained. For Affiliates, $350 can be paid at the beginning of the first policy year and the remaining $650 balance can be paid just prior to the first year renewal. If you paid less than the full $1,000 during our capital drive, you can either bring the balance up to $350 or leave it at any figure above that until you have your first renewal at which point you will need to have the $1,000 fully paid.
A. Not at this time but there will be news about this in Q1 2011.
A. We appreciate your interest and enthusiasm. Please wait until you have completed your Level I certification. You will have an opportunity after that to participate in the program.
A. There will be no standards above and beyond those required by CrossFit, Inc.
A. An affiliate owner's policy will cover trainers who are (a) working at the box and (b) in the scope of their duties. Thus, an affiliate owner does not need to purchase anything for each trainer...HOWEVER...an individual trainer is free to buy ownership in the company and may have a policy separate from their affiliate owner's. This would cover them for training they do that is not associated with the affiliate they normally work for.
A. The $1000/200 buy-in will get you an ownership stake in the RRG. You will receive shares of stock. That will make you eligible to get a policy and premiums will therefore be separate. Premium rates will be based upon business revenues. They will be very comparable to what exists in the industry. Eventually we hope to bring those down IF we pay few claims and are sufficiently capitalized. Minimum premiums are presently $1,050 for affiliates and $250 for trainers.
A. The RRG itself writes policies that cover what we call Errors and Omissions. Let me drop a definition here - think of this piece like malpractice insurance for lawyers or doctors. Sometimes you may recommend a course of action to a client in your professional discretion as a trainer. It may be perfectly valid and one that we all would recommend. The person may still get hurt (rhabdo, round their back on a DL and hurt a disc, etc.). The RRG will cover that and defend that, if necessary. This is the piece that is currently missing from most policies and most of you probably aren't even aware of its absence/exclusion from your policy. Wrapped around that policy will be what you can think of as a standard, commercial liability policy for slip and fall, property, someone drops a kettlebell on their own head or foot and on and on. They fit together - snugly - because WE helped write the policies that way by working with the insurance provider we have who helped us set this all up.
In conjunction with the above, the complementary policy will have its own premium, but we've set up a mechanism that it can be billed "singly" and you'll get one envelope, so to speak, with the two policies enclosed. In 2011 we hope to have the RRG offering both the professional and the general liability policies.
A. The CrossFit RRG is a Stock Insurance Company which is owned by CrossFit Affiliates and CrossFit Trainers. Each will receive a share(s) of stock for their capital contribution/investment.
A. Each member down the road would pay the same capital contribution as the members at this time. The only way to charge a different "buy-in" would be to have a valuation of the company completed and determine that the stock would be worth a different value. CFRRG is not a "wall street" exchanged company, so the short answer is the buy-in will be the same $1,000 per affiliate and $200 for trainers. This is also mandated by the Federal Liability Risk Retention Act.
A. There is a membership agreement that states how capital will be returned to each member. A member will not be able to sell their part of the RRG to another member or any other individual. There is no interest earned on this investment. The capital contribution is not a savings account. Only principal will be returned and if a member is due a dividend when they depart then that too will be paid.
A. I would suggest that you join the RRG as a Trainer and then when you become an Affilate you can make the additional contribution and we will transfer your stock certificate from Trainer to Affiliate. You would not need to pay both full capital amounts. Example: pay $200 as a Trainer and then $800 more when you become an Affiliate for a total contribution of $1,000.
A. The RRG is a non-SEC traded entity. Therefore your capital contribution is just that. It will not be tax deductible and you will not have any tax consequence until you receive dividends. When dividends are paid, you will be then taxed at the capital gains rate, which varies depending on your tax bracket. If you ever receive your capital contribution back, you will not be taxed on that transaction either.
A. Because this is a "stock" RRG and each policy issued by the RRG is fully insured, the policyholders do NOT have joint and several liability.
In addition, the RRG purchased reinsurance to protect the RRG from a large claim.
In the unexpected event of an insolvency, RRG shareholders will lose their investment in the company but that is where the shareholder liability ends.
A. If two trainers merged to create an affiliate and that is a formal licensed affiliate, you would pay the difference or $600 in additional capital to satisfy the investment for an affiliate.