Money Game: Why golf-course insurance is serious (and essential) business  

No golf course is safe from Mother Nature or human negligence.

Take what happened in February at Oakland Hills Country Club, just outside Detroit.

Oakland Hills, the site of more than a dozen major championships — Ben Hogan famously referred to it as “the monster” when he won the 1951 U.S. Open there — was engulfed in a fire that resulted in more than $80 million of damage to its historic clubhouse. The cause has still not been fully determined.

Needless to say, Oakland Hills, or any course, can’t truly replace what is lost in a tragedy of such magnitude. But obtaining the proper insurance can provide much-needed help in an expensive rebuilding process that might take years.

Which is where insurance companies enter the picture. Many of the same insurers that offer protection for your home or automobile also serve as safety nets for golf courses.

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Travelers, which has its name on a PGA Tour event, sells golf-course insurance. So, too, do smaller shops such as Philadelphia Insurance Companies, which offers coverage to courses and clubs for everything from liquor liability to pollutant clean-up and removal.

Among the newcomers to the space is Sentry, a brand with which golfers may already be familiar; the company owns SentryWorld, a Robert Trent Jones Jr.-designed course in Wisconsin, and has been the title sponsor since 2018 of the PGA Tour’s season-opening Tournament of Champions in Maui.

Based in Stevens Point, Wis., Sentry is launching a new initiative this year to sell insurance to public, semi-private and country-club courses across the country. The company has identified about 8,000 courses to approach, with the hopes of securing at least a few dozen contracts by the end of 2022.

“We are in the business of golf,” said John Hyland, the president of Sentry’s direct writing group. “We own a golf course. We’re a title sponsor of a very significant tournament. Why wouldn’t we start getting into the insurance side of this?”

The key for insurers is identifying how best to protect courses, of which there are a number of ways. One type of coverage is referred to as “tee to green,” which — just as it sounds — would compensate courses for any damages from the tee box through the fairway to the putting surface. Typically, for that kind of coverage, Sentry will offer $1 million worth of benefits, though it can be increased depending on the specific needs of the course.

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“Some courses, it may cost more to replace the damage whether it be by storm damage or vandalism,” said Mike Schmike, Sentry’s chief underwriting officer.

The premiums which courses would have to pay for the tee-to-green coverage will depend on the coverage limits that are purchased, and those will vary from state to state. “If you purchase $1 million in standard coverage, it will cost you less than if you buy $5 million worth of coverage,” Schmike said.

Courses will also be able to purchase protection for errant golf balls, meaning, for example, if a golfer breaks a window of a home or vehicle, or causes an injury, a course would generally receive $1,500 per incident, Schmike said.

Courses can even insure their most sentimental design features, like, say, a signature oak that is felled by a storm.

“We have the ability to identify that tree and provide more than just the normal coverage for it,” Hyland said. “Replacing it, you just don’t want to plant the seedling in the ground. You might want to search out a more mature tree to transplant. That comes with additional costs.”

Ultimately, Hyland said, just as good teaching pros tailor their game-improvement advice for each of their student’s swings, golf-course insurers should follow the same principle with their clients.

“It’s really working with each individual course to understand what’s unique about them and designing a program that meets their needs,” he said. “The last thing you want is a cookie-cutter approach.”

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