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My business is going to be group fitness with in all ready established gyms. We will certify instructors through our company to run classes with in gyms.

The thing we are trying to figure out is how do we differ liability from being all on our company and put it on the instructor as I met with some insurance people and they basically gave me scare stories and told me how we could not do what we wanted to.

I know what they told me is false as there are other business in the fitness industry who are structured similar to how we are and most of the liability is placed on the instructor who they certified who they encourage to get insurance but they are not required and/ or covered by the certifying group.

So how do I cover my self and company in this situation from potential issues that may arise from instructors actions?

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2 Answers

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If I'm participating in an instructor lead activity following the guidelines of your certification, my lawyer will want to go after your deeper pockets (Nothing Personal). This is especially true if the trainer has no insurance; they'll try and settle with yours.

If the instructors are private contractors (work at other gyms or offer private training) and are leasing your space for their classes, they may be more liable. You'll need a lawyer to work out this arrangement.

The certification aspect involves you a lot more. You may want to suggest they get additional certfications from a 3rd-party.

* Contact a lawyer and an insurance agent.

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It's pretty hard to contract away potential liability you have by default. That's why people buy insurance. You can also make contracts between your instructors and your company wherein they agree to cover any judgement - usually described as "hold harmless" (I think). But even that doesn't remove your liability to your customer, it is just an agreement between you and your instructor to pay for it.

This is why it is important to have limited liability thru incorporation. Then at least the most they can take is your whole business. You can also create separate companies to work with each chain of gyms or even with individual gyms. Then a problem doesn't take down your entire business.

And, true or not, of course your insurance salesman has plenty of scare stories for you. They teach them that in insurance salesman school. Talk to your lawyer about dealing with the risk.

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