League of American Bicyclists 2014 Insurance Program Planning Discussion Marla Peters, Sr. Vice President Rene Waterson, Vice President American Specialty Insurance & Risk Services December 9, 2013

Goals for Call  Provide Insurance Program Overview Program Summary and 2013 Results Factors affecting Plans  Receive input from call participants

Program Summary and 2013 Results  General Liability (GL) and Participant Accident (PA) automatically included  594 organizations purchased coverage 81% bicycle clubs; 19% advocacy organizations  New Structure Implemented in 2013: Advocacy Organizations (i.e., those with little or no regular ride activity)  Flat premiums apply (GL only for those with no regular rides)  Special events (i.e., rides with participation fees) can be covered for additional premium Bicycle Clubs  Premium based on per member rates (subject to minimum premium) plus applicable special event premium Special Events (i.e., rides with participation fees)  Must be scheduled and per participant rates apply (subject to minimum premium per event)

Program Summary and 2013 Results Cont’d  Optional Coverages # that Purchased Directors and Officers Liability 140 Bike Refurbishment 29 Nonowned/Hired Auto Liability 15 Excess Liability Limits 11 Optional Participant Accident 3  LCI’s receive General Liability coverage for their individual education activities

Historic Rate Summary (based on bicycle club member rates) YearRateChangeMin. PremiumChange %849.1% %918.3% %932.2% Flat93Flat % % Flat83Flat Flat83Flat %83Flat %886.0% % % 2014 (proposed) %1294.9%

Historic Claims Summary  Roughly 7 General Liability claims per insurance year (small number of claims with potential to be very large) 2 claims (1 paid, 1 pending) of roughly $400k from pedestrians struck during club events in past 7 years  Growing number of Participant Accident claims that are costing more on average over time 113 claims in 2012 up from 46 in 2008 Average cost of $1,650 in 2008 up to $2,250 in 2012 Average loss per club has more than doubled in this timeframe 2013 losses are anticipated to be greater in number and cost  We have had no paid Directors and Officers or Employment Practices claims

Factors Affecting 2014  Large General Liability losses as well as continued increasing Participant Accident losses require an increase in rates and minimum premiums again this year, but a much smaller increase than 2013  Tightening General Liability insurance market conditions for amateur sports associations remain a factor impacting premium increases

2014 Plans  Continue current program structure and limits/benefits. Proposed rates are as follows: Current GL/PAProposed GL/PAChange Advocacy Organization – No rides 68 (GL only)75 (GL only)10.3% Advocacy Organization – Minimal rides % Bicycle Club (per member) First 1,000 members % Second 1,000 members % Over 2,000 members % Minimum Premium per Club % Special Event (per participant) First 1,000 participants % Second 1,000 participants % Each participant over 2, % Minimum premium per event %

2014 Proposed Rates Cont’d Current GL/PAProposed GL/PAChange Education (optional benefit) Classroom only – all LCI taught 30 (GL only)33 (GL only)10.0% Classroom only – not all LCI taught 40 (GL only)44 (GL only)10.0% On-bike – all LCI taught % On-bike – not all LCI taught % Bike Refurbishment (optional, if applicable) 60 (GL only)66 (GL only)10.0% Year-Round Office Space 50 (GL only)55 (GL only)10.0%

Discussion Items  Program Structure Thoughts on increasing minimum premiums in the future to off-set rates? Does the current coverage and pricing structure accommodate the needs of bicycle clubs and advocacy organizations?