Drugs and insurance
OCTOBER | COMPANY PROFILE
The drugs issue, covered in Access’ September issue, requires risk
management, says Luker Rowe’s Peter Tilsed
W
ho would want to
be responsible for
organising an event
where several thousand people
arrive on one site for a small
period of time, where health and
safety is a major issue and where
it is known there is likely to be
a substantial amount of drugs?
From the increasing number of
festivals organised over the last
few years, it appears that lots of
people are. Due to the possible
problems of accidents occurring,
drug abuse and financial loss,
many festivals have set up limited
companies to protect themselves.
But what about the individuals
behind these companies?
Regardless of whether you
run a manufacturing company,
a building contractor, a motor
garage, an estate agency or even
an event company, directors have
individual responsibilities. The
number of claims where directors
have individually been sued has
increased in recent years. Areas
where a director may be personally
liable are where they have failed
to put safe places of work in place
or provide protection for their
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employees. Whilst a company can
be held responsible for corporate
manslaughter, the director can
be held personally responsible for
gross negligence manslaughter.
Claims may not be restricted to
those against directors and could
for instance be against the health
and safety manger. Protection
is available under a Directors &
Officers insurance policy and with
premiums for a small company
starting around the £250 bracket,
it would be a sensible area for any
director to review so that their
own personal assets are not lost in
the event of an incident.
Shifting conversations
Bestival have announced that
they will be providing drug-testing
whilst Reading and Leeds have
the opposite approach saying that
there will be none. Whilst it is
initially not an insurance issue, I do
wonder how long it will be before it
gets brought into the conversation.
When actions are taken which
others do not agree with, there
has been a tendency for one of two
reasons to be given:-
1. It is for Health & Safety reasons.
2. It is an Insurance requirement.
So much is blamed on Health &
Safety that the HSE have added
a Myth Busters page to their site
(HSE.Gov.uk/myth). This lists over
400 cases where Health & Safety
reasons have been quoted and
the HSE have explained why the
reason was not relevant. They even
list at least 15 examples directed
solely at events.
The Insurance Industry has
not been so robust in replying to
comments which in many cases
are also myths or are where the
insurer is just trying to enforce
good management practices.
This brings us back to the drug
issue at festivals. No doubt either
action or non-action by organisers
will at some point be passed back
as an ‘insurer requirement’.
Any accident at a festival is
possibly going to be a future
insurance claim. So will insurers
be required to deal with claims
because either:- a festival has
offered a drug-testing facility but it
has failed to recognise a bad batch
of drugs or there have been deaths
or illnesses because no drug-
testing was in force.
Whilst the phrase volenti non
fit injuria may not be in daily use,
it is very relevant when someone
is injured from undertaking
something that is known could
cause injury. This could reduce
the duties of the organiser but
wouldn’t take away all their
responsibilities. A claim may
therefore still succeed under
public liability insurance, although
organisers need to be aware that
sometimes a drugs exclusion will
be added to an event organiser’s
policy.
I am sure that the discussions
will continue to develop but on this
occasion it may be a one that does
not claim to be due to Health &
Safety or Insurance reasons.