Hole-In-One Insurance

Hole-in-one insurance, developed as aninsurance and marketing product to help promote events, has notsuffered the same fate as other insurance products, according tothe president of one single-niche facility specializing in thecoverage.

However, he said, sales have flattened in the wake of a weakeconomy, intense competition, and some not-so-reputable promoterstaking advantage of a legitimate insurance service.

“We are feeling theeffects of the economic downturn,” said MarkGilmartin, president of Hole-In-One International, headquartered inReno, Nev. Rates have remained the same because the products riskexposures have remained the same year-in and year-out, he pointedout.

“This is the only insurance product where people root for theevent to occur,” added Mr. Gilmartin.

Since 1991, Hole-In-One International has been providing prizecoverage for events such as making a hole-in-one on a designatedgreen during a golf tournament. However, the coverage is only partof a national package that sells marketing material and otherpromotional services for a wide range of events includingcharities, retail businesses, radio, television, Internet, andother sports promotions.

Nationally, growth has flattened out in the last couple ofyears, Mr. Gilmartin said, as companies and charities have cut backon their promotions and there has been a less than anticipatedgrowth in the golf market.

Another issue is competition. While there are legitimateplayers, such as National Hole in One Association in Dallas, thereare also those not licensed to sell the product and do. Thesepromoters, by perpetrating fraud, have given the product a blackeye, Mr. Gilmartin pointed out. In most of these cases, thepromoting company finds an excuse never to pay the claim.

Agents and their clients, in order to avoid such scams, mustmake sure, as with other insurance products, that hole-in-onecoverage is backed by a qualified insurer, explained Mr. Gilmartin.In the case of Hole-In-One, the product is underwritten byInsurance Corporation of Hannover, a subsidiary of HDI U.S. Group,based in Los Angeles and owned by Hannover Reinsurance Co. ofGermany.

Reproduced from National Underwriter Property &Casualty/Risk & Benefits Management Edition, August 5, 2002.Copyright 2002 by The National Underwriter Company in the serialpublication. All rights reserved.Copyright in this article as anindependent work may be held by the author.