Basejumper.com - archive

For one year of insurance coverage for injuries on legal jumps anywhere in the world, how much would you pay?

Let's assume the coverage would be $1,000,000, which will probably be good enough almost anywhere.

Sounds awesome, but unless I'm missing something it's an uphill battle unless other sports are brought into the loop.

Quick and dirty math:

$1000 per person premium, let's say you get 3000 BASE jumpers (which seems very optimistic), then your premium pool is up to $3mm.

Out of 3000 jumpers let's say that 1% get hurt each year (seems low to me). That means you're covering 30 injuries around the world in any given year.

As long as the average medical costs are under $100,000 per jumper then you're in-the-money. Now it seems likely that you'd be in the black most years, but there's some huge risk there. It would only take a handful of catastrophic injuries in any given year to break the bank (err...insurance company).

Now if you say there are only 2000 insured and a 3% injury rate is more typical...now you're margins are really starting to get squeezed.

If you could loop in safer sports though...mountain biking, climbing, etc. you could draw on a larger pool of participants and also reduce the average risk of the pool.

But insurance company logic would simply suggest that you drop the minority group with the highest associated risk. This is because the minority group with the highest risk is more likely to take advantage of the insurance than the majority group with less risk exposure (i.e. adverse selection).

You're a pretty smary guy and I suspect there are some puzzle pieces that are missing from this thread though. I'm curious to see what your angle is.

Disclaimer: I'm not very familiar with any medical systems outside of the US. So I suppose if you're in a country that would cover the majority of the medical costs and the insurance would only be required to pick up a small fraction of the cost you might be in business. But if this is the case I think it will be tough to sell $1000 policies to people headed to destinations with free medical care.

*edited for grammar

Do you work as an actuary?

I pay $90 a year so no more than that,....but if you can get me a better deal I'll take it!

Hell no. I'm just moderately familiar with how the business works.

hello Bluhdow & everyone,
Thanks for your feedback & please everyone, give me more of this constructive feedback.

I am talking with an insurance company that are very interested in covering base jumping. It is still early stages yet but i am trying to get insurance for all base jumpers on legal jump and events throughout the world.

So i need to know what jumpers would be willing to pay each year and what excess they would pay etc.

Would you only pay $100- or $600 or $1000- to be covered?

This could be our last chance to get base jumping specific insurance so I really want to make it work. Australia is already basically impossible to get insurance and it will only get worse.

So please send me your constructive thoughts on this issue.

thanks
Douggs

Perhaps the solution is a sort of "self-insurance" fund. We open a not-for-profit company and all contribute agreed premiums for a period of one year while remaining on our current insurance plans.

After there is a build up of a decent reserve we use the money to help the jumpers in the plan. A for base jumpers by base jumpers insurance scheme.

There are many technicalities to the process but it would be an awesome idea to protect ourselves in the event of injury regardless of legality, nationality, country, race or gender. Then we can harness the global base market.

just a thought. I'd be willing to pay $300 to know i'm covered for injury.

I would be comfortable with 500 maybe 6 GBP for top end annual cover but would have to include incidents leading up to the actual jump itself to replace my current mountain insurance - so hiking/climbing in the mountains as well as when you step off the exit (and dog bites ;-) )

Graeme

It's hard to say how much I would pay, but $100/month is definitely something that sounds very reasonable. And I am sure many would be willing to pay more. A single accident will make it worth it many times over.

Why do the BASE jumps have to be legal

for the insurance coverage to be valid??

Tom A. lives in Twin and Douggs jumps

in Europe, but most the rest of us here

in the USA trespass to get our altitude

This is one of my concerns, too. I understand why an insurance company can't provide coverage for illegal activity, but in the absence of that protection, I am better off purchasing trip-specific insurance for my away-from-home excursions.

At home all my jumps would be policy exclusions. All of 'em.

As it stands, I can get coverage for legal BASE jumps as long as I'm 100 miles or more from home. And the premium for me was $65/week, roughly. If I take 2 or 3 trips per year, my total premiums are $200ish. So paying +/- $1,000 per year for coverage that is largely null 'n' void by definition isn't reasonable for me.

~ Chris

my thought exactly! I would think the vast majority of BASE jumps are illegal but maybe I am naive.

Great stuff guys, thanks. I will enquire if illegal jumps can be covered, but i am not too sure if they would.
so if people are just doing short trips to legal jumps, would you be willing to pay for a 1 week cover for example or a 2 week cover? what would you be willing to pay for this sort of cover or just cover for an event, say like KL tower?

thanks for being constructive on this. i still do illegal jumps too but as has been said, i live in europe now and i know it is different for me.

i am trying to gather as much information as possible to put in a good / fair proposal. so thanks again and please keep it coming :)

If it was a not-for-profit structure that could take donations and act as beneficiary for estates and life insurance policies that would provide a way for the pool to get large lump sums from time to time.

So in addition to paying monthly premiums, let's say that I wanted to give back to the community by assigning this non-profit as beneficiary on my life policy at work. That could help to provide much needed liquidity to an insurance pool that seems likely to struggle, or at least hit rough patches.

You could incent these types of gifts by offering discounted, or in some cases free, coverage as long as the pool is the designated beneficiary.

In the US these gifts are tax-deductible so there's an incentive to donate in addition to simply giving back.

Just kind of thinking out loud here. I appreciate what you're doing and would like to help in any way I can!

If you were able to provide the service with a monthly (or even weekly) option that would be much more desirable I think. Trouble is, now the insurance company knows you'll only pick it up when you're most likely to be hurt. So it won't just be a per capita conversion from the annual rate. If annual rates were $1000 it wouldn't surprise me to learn that monthly rates were $350 or something like that.

Still...it's a more attractive option for many.

I've spent some time thinking about the self-insurance "for-jumpers by-jumpers" option. The biggest issue there is that insurance is a business and our scheme would need to hire people to administer it. Actuaries, contact people, insurance agents, etc. We'd essentially end up starting a business. If we go that route, I'm interested in the CEO position. =)

Here's another big issue...fraud. Let's say I'm in a car accident and I break my leg. My medical insurance covers it and I'm reimbursed but then I decide to tap into this fund as well. I call up and say, "hey, I broke my sh*t BASE jumping."

What's the mechanism in place to prove that these accidents resulted from BASE injury? Are we going to fund investigations into every claim? There's also the potential for people to pick it up as cheap de facto all-around accident insurance.

Douggs,

The policy I purchased most recently was for our trip to China. The policy covered 8 days of travel and jumping, and it provided medical coverage for illness and injury, evacuation coverage for definitive treatment outside of China, coverage for a travel companion to accompany me if I was injured, and then some regular travel-type coverage benefits like lost luggage, trip interruption, trip cancellation, etc.

Oddly, the policy did not provide any coverage for other men trying to claim that my wife was his wife. But that's another matter.

My premium was $65 for the 8 days. $65 isn't too bad for the extensive coverage, but that adds up quickly if the premium is linear for trips of extended duration. If I had to pay $260 for a month of coverage, I may have thought twice before spending the money.

In the past, I've also seen defined-benefit policies for high-risk sports. That is, rather than saying the policy covers medical expenses of a wide variety up to $1,000,000 max, the policy might say it pays out $1,000 for a broken femur, $500 for a broken clavicle, etc. A policy like this can help close the deductible/co-insurance gap for those who already have broad medical coverage.

~ Chris

This is exactly what I was thinking. Even if it only covers legal jumps, which in itself is completely understandable and reasonable, i find this amount to be very fair.

GoPro Finally jumpers could have a good excuse for using one

I'd happily part with 1k a year for the peace of mind, as long as it covers me for everything (base, skydive, snow sports, climbing, speed flying etc)

Are you able to say what country the insurance company you are speaking about resides; or pm?


Using ihi as a baseline... for everything that bupa was when I first bought it for LBV winter 06 and Norway 07 (needing in there, and still covered while jumping injured at KL tower); if it covered any "legally" obtained BASE jump, for a full year coverage, and was just as legit as ihi... I would definitely fork up in the ballpark of 1500.

my thoughts, but i thought it would be more direct to you here, i think i would happily pay 600 a year, as a pretty mild base jumper, (maybe 40 object jumps a year, 30 or so being legal) the other 10 or so not legal. so maybe insurance packages, less than 100 jumps a year, and higher packages, (problem is this is basically on the honor system) with a worldwide package option and a travelers add on package for a base trip. as all of my current jumps are inside the U.S. So my idea is just different levels of coverage based on activity, and travel.

Douggs - I would pay $1000 a year to get the minimum coverage of $1M as Tom posted. I am an interested jumper with a wife and three kids. If I get permanently injured or go in, I would like to see they are taken care of. Thanks for the post on FB and here.

Maybe having an upfront excess will help reduce premiums? I am not worried about the $1000-2000 bills but would cringe at those 10x more, and that is when insurance kicks in. I.e the injured jumper pays the first $2000. This will negate the more frequent but low cost claims and help insure the insurer doesn't take a loss.

This is known as a deductible. Many policies will offer a range of different premium/deductible options. The higher your deductible, the lower your premium and vice versa.

I think a range of premium/deductible options would be great so jumpers can choose if they'd like a full-on cover-everything policy or just a high deductible policy to cover catastrophic injuries.

It would probably be easier to get the big deductible plan together first.

Definitely. They are generally easier for the insurance companies to underwrite because there is (usually) more data on big injuries than small ones.

That said, whatever insurance company takes this on will definitely be marching into uncharted waters. I applaud and thank them for that...it's a much needed service around here.

Another interesting upshot is that the BASE community is likely to get a lot better data on injury/fatality rates in the sport (as long as the insurance company is willing to share). I wonder if an annual survey of the policyowners about number of jumps, object types, gear, etc. would be tolerated by the community in the name of better data. I'm sure the insurance company would be open to facilitating such a survey since it would only improve their ability to underwrite.

In the last eight years I have only jumped one legal object. In the last eight years I have made one trip to the ER and it was because of a (cough cough) um... A mountain biking accident. Yeah that's it, a "mountain" "biking" "accident". Which my insurance covers...

So, if it covered ANY BASE jumping, then I might look into it...

I paied 90 EUR and that is maximum...

I doubt anyone is going to write a policy that specifically includes illegal activities, and I'm also pretty sure that if they tried not to pay on that, the law in most places would be on the side of the (non-paying) insurance company.

So if I'm in my car speeding, breaking the law, and I wreck and hurt myself, my insurance will still cover me, even though I was breaking the law...

Ha you're funny with your 2k deductible saving money. 2k would be an excellent deductible and would cost you. The norm is becoming 6300.

Deductibles are used to overcome Moral Hazard,
which is a financial incentive to engage in some
kind of undesirable behavior.

Deductibles help to align the interests of the
Insurer and the Insured, which is similar to
the classic Principal-Agent issue.

Contracts are a fun sub-section of Economics.

Douggs,

Thanks heaps for looking into this on everyone's behalf. I would certainly pay $1000 for cover. But definitely a trip based cover, even if it was something like $350 a month would be better.

For me trip based cover would be better because I live in New Zealand and everything here is covered under our ACC, but I can no longer get any travel medical insurance. For me, jumping without medical cover is outside my acceptable risk. Because of this I have essentially given up on being able to jump outside NZ.

Before last year I regularly travelled overseas jumping. I had been to KL and Sibu for three years but last year was unable to get any proper cover. I had several brokers looking for me and the best they could come up with was $3000 for 2 weeks cover and a max. payout of $50,000. It seems New Zealanders were excluded from the few insurance packages that did cover base jumping. I'm not sure why but guessed it was due of lack of data because once we get home we are covered by government healthcare.

Anyway it will be interesting to see if you can get anything out of them. But even if it was something that has a high excess/deductible that would still be better than nothing.

Cheers,
Mitchell

Thanks Mitchell and thank you to every body for keeping this thread serious. Please keep your thoughts coming. there is some great information coming in.
thanks to everyone
cheers
douggs

Maybe as a group we could use a different approach to a number of Insurance Companies; instead of asking for a specific Base jumping policy, divide the risk into categories and ask for a policy to cover each risk item ie
1. Site evacuation/rescue (air ambulance, SAR, ambulance etc)
2. Medical/hospitalization fees
3. Compensation for loss of earnings
4. Disability
5. Lump sum payment in case of death.
Base jumping is a largely unknown quantity and therefore seen as high risk activity but if the load was spread or divided maybe a Company(s) would be more willing to take on the risk?
Just a thought, without any insurance background what so ever.

Yep, same with the Wifey and I both.

How could 1k/year possibly cover you for all of those activities? I just don't see it happening financially for the company......but maybe I am being pessimistic....