Prize indemnity insurance covers contingent prizes on behalf of sponsors or promoters. Prize insurance allows the sponsor / promoter / organizer to offer a large, risk-free prize for only a fraction of the cost. Some examples include probability-based prizes such as drawing the correct envelope, dice rolls, spinning a wheel, etc., and skill-based prizes such as sinking a 60-foot putt, shooting a basketball from half-court or making a field goal from a certain distance.
Over-redemption insurance allows a marketer / sponsor to transfer the risk of a coupon or free product offer that is "too successful". Sponsors / marketers often will distribute coupons, “buy one, get one free” or multi-purchase benefits to increase awareness and sales of their products. Our coverage allows sponsors to protect themselves against an unexpected high redemption of those coupons.
Contractual bonus insurance is coverage that is purchased mostly by corporate sponsors to give professional athletes an additional financial incentive in their contract to achieve a certain result. For example, a professional golfer could earn an extra $500,000 for every major championship that he / she wins, in which case, the risk of the additional $500,000 would be transferred to an insurance policy.
Promotion bonds, also known as game of chance surety bonds, are required in Florida and New York for any game of chance promotion over $5,000 in retail value. The promotion must be bonded and registered with their office. Rhode Island requires only a registration for any retail promotion over $500. No other states require these promotions to be bonded. ESP Specialty can streamline this entire process for our clients.
Prize indemnity insurance
Games of skill for sporting-related contests includes coverage for basketball half-court shots and parlays, football tosses and field goal kicks, hockey slot shots and golf putting and hole-in-one contests
Games of chance such as dice roll games, spin-the-wheel games, the lucky envelope game and more
Contractual bonus insurance
Integrated marketing agencies
Limits vary by promotion
Up to $10 million with more available subject to market support for insured promotions, over-redemption and contractual bonus
Up to $10 million for promotion agency E&O
Minimum premiums are subject to risk purchasing group program restrictions only.