Insurance Options for Tour Operators

If you’ve just started your tour business or watersports company it’s essential to consider what type of insurance you will need for your business. This is particularly true if you plan to sell your activities through an online travel agency like TripShock, because many OTA’s require you to have insurance. Depending on the types of tours you offer, navigating all the options can get a bit tricky. While we cannot tell you what type of insurance is best for your business, we encourage you to get a basic understanding of the types of insurance that are out there and then go speak with an insurance broker and, in some cases, an attorney.

The list below is not exhaustive as there are a wide variety of insurance types out there. We’re going to lay out a few different types of insurance that might be applicable to your tour, attraction, or equipment rental business. Keep in mind that some policies will group various types of insurance together. The key is making sure that your policies cover injuries sustained by your guests and your team, as well as your property. Let’s dive right in.

Table of Contents

• General Liability Insurance
• Commercial Property Insurance
• Commercial Auto, Boat and Vessel Insurance
• Business Income Insurance
• Worker’s Compensation Insurance
• Cybersecurity Insurance
• What’s Next?

General Liability Insurance

General liability coverage is important when you have a brick and mortar location where customers could potentially fall and get injured. Likewise, it’s important  if you offer activities where people are using equipment you provide them. If you are towing guests on things like banana boats, taking them parasailing, or even on a bike tour, you should likely be carrying a general liability policy that would help to cover damages that might result from an injury lawsuit. However, it’s important to remember that if damage occurs to your equipment or property, it  likely isn’t covered by your general liability policy. Also, if you are doing a higher risk activity, it could be more difficult to find a company that will insure your business and additional specific types of liability coverage may be needed.

There are a handful of companies out there that offer coverage for watersports activities, including insurance for cable parks, wakeboarding and other towed watersports. While we cannot tell you which company is the best, we recommend that you shop around and speak with other operators that do similar activities to get their advice and recommendations.  You can also reach out to the watersports industry association or other travel associations for advice. 

In some cities, like Charleston for example, tour operators that conduct walking tours on city streets have to pay a per guest tax to the city. This money is used to support the city should an accident occur on city property. Be sure to check and see if your destination also has such a requirement.

Commercial Property Insurance

Commercial property insurance covers damages that happen to the property you own. So if your tour or watersports business has physical assets like a building, jet skis, or boats, you need to be sure your property is insured. This insurance will help cover the cost of your capital investments in the event that they are damaged or destroyed. In many areas you will need to consider special coverages like hurricane or wildfire coverage to be sure that you are protected. Keep in mind that when insuring a vessel, you may be able to find a policy that covers both injury and property damage, more on that below.

Commercial Auto, Boat and Vessel Insurance

Commercial auto insurance is similar to regular auto insurance and should be carried on all vehicles that are owned by your business. Likewise, if you are operating a boat for commercial purposes, you will want to be sure your vessel is properly insured.  Many companies offer maritime insurance. Check out this guide to buying insurance for your charter boat to see what types of packages may be available to cover both injuries and property damage.

Business Income Insurance

This is one that not everyone has heard of and it may not be practical for all businesses.  Let’s say your booth burns down. Your property insurance may cover the damage to your boat, but what about the income you lose while you can’t operate? That’s where business income insurance comes into play. It may cover some of the income you lose if you are shut down due to a variety of incidents.

Worker’s Compensation Insurance

Worker’s compensation insurance is a benefit provided to employees if they get sick or injured while working. In most states it’s legally required so be sure to check your state laws and make sure your employees are covered. In Florida, worker’s compensation is required for all employees and in some instances special coverages apply for certain industries.

Cybersecurity Insurance

We rely so much on the tech that supports our business and more and more of our online assets are becoming at risk of cyber attack. Even small businesses face a variety of attack risks. What would happen if your business’s website was hacked and shut down for a month? Would it have a drastic impact on your business? If so, you may want to look into options for insuring your business in the event of a cyber attack.

What’s Next?

There are many more types of insurance out there, so be sure to consider all the options and talk to as many experts as you can. Generally speaking, working with companies like TripShock will necessitate you having some sort of liability coverage so if you hope to sell with third parties, you will want to have your bases covered. It’s also important to consider other watersport essentials like proper waivers, terms, and staff training.

If you want to learn more about insurance, we are happy to help connect you with other operators that may be able to give you advice on what worked for them or help you access other industry resources that could be valuable to your business. Be sure to check us out on social media and follow our blog for more insights, tips and tricks.