UKC

I've just seen an email sent by Dave Turnbull (BMC CEO) and signed by Gareth Pierce (BMC Chair) and Lynn Robinson (BMC President) giving some background for a proposal to be considered at the forthcoming AGM to raise ALL membership fees by £6 following a "substantial" (over £5 million) insurance claim.

The email says that the third party insurance scheme has had to be reviewed and that the cost to the BMC will be an extra £200k per year for this year with an additional £50k per year from next year.  My simple maths gives that as £250k per year extra that has to be found and the obvious way is to increase membership fees.

The BMC's website says that it has "over 85,000 members" so why such a large rise in fees?  £3 per member should cover this.

Can somebody from the BMC (preferably Dave, Gareth or Lynn) come on here and explain how the £6 figure was determined?

BTW mods, what happened to the BMC forum?

I would imagine there was a need to increase subs anyway and the the entire increase may not be due to the insurance claim.

Also, not all members are individual members, some are club members and I've no idea if the memberships will go up the same amount or by a similar percentage etc....

The BMC forum changed to "Local Areas" some time ago. These rare but large insurance claims always have a negative effect on the organisation. As you say, you need someone who understands the mechanics of the insurance/membership tie up to explain this one.

We removed that around 8 years ago, or changed it to the wider Access Forum in actual fact. Email me if you want more details since I don't want to deflect this thread.

On your first question... 

Is the £6 membership fee rise for club members as well?

Alan

Let me guess - was it Bear Grylls again?

here's a quote taken directly from the email - 

"... a resolution will go to the BMC AGM for a £6.00 per person increase across all membership categories (including club members and individuals)."

Appears to be, according to the letter our club has been sent.

it was a "serious injury in a BMC affiliated student club" and a BMC task group has been created to review "the BMC’s technical advice on belaying".

Take from that what you will.

It is a big rise and has to be voted through at the AGM by members.

I'm no longer from the BMC office but I was at the Peak Area meeting when this was discussed. Dave was there. The recommendation was made by the Finance Committee to balance future budgets. Dave also made comparisons with other membership organisation fees.

The justification is partly determined by the anticipated increased cost of liability insurance (which has yet to be agreed) but also additional costs attributed to the ongoing organisational review recommendations ie legal costs, hiring a project manager, hiring a governance officer etc. I also assume that Sport England grant money is lower than before.  

As Shark mentioned, this was discussed at local area meets prior to the email going out. The increase is to cover both the associated costs of the claim and additional ORG work, as Shark also states.

I'm in agreement with the rise being uniform across club and individual members for what its worth.

We should not lose sight of the fact that someone has been really seriously injured so if any money goes towards trying to help reduce the likelihood of this happening I think this has to be applauded. Its a significant rise in terms of percentage but when put in context (as Lynn did at the Yorks meeting) BMC membership is still extremely cheap in comparison to other sports. 

Just had a check of the January board meeting minutes whish are now up:

https://www.thebmc.co.uk/bmc-board-of-directors-meeting-summaries-and-minut...

Alan Brown’s paper was noted and GR confirmed that based on current forecasts, in order to breakeven in 2020, subscription increases of £2.50 (individual members) and £1.00 (club members) would need to go to the 2019 AGM. Further to a substantial claim (multi-million pounds) arising from a climbing accident in an affiliated club there is likely to be a £40- 60k per year uplift in the annual premium for the BMC’s Civil Liability insurance for members in 2019. Other anticipated new costs include the appointment of a BMC Governance & Compliance Officer. DT noted that a budget review process is taking place in the office on 15 January (involving key budget holders, GR and David Lanceley) and that this may generate some cost saving which would need to be factored in to the equation. It was agreed that it was necessary to proceed with the recommendation for a subscriptions increase to go to the 2019 AGM. Action: DT to produce an explanatory paper for the January Area meetings (deadline 18 January), setting the proposal in the context of the value that would be provided to be members and how BMC subscriptions compare with other membership organisations.

(Alan Brown is the BMC's salarid Finance Manager and GR is Graeme Richmond who is the volunteer Treasurer) 

I don't recall seeing the explanatory notes at the Area Meeting though I was late arriving. Clearly the £6 is different to that proposed at the Director's meetings as well as the Area Meeting where £6 for individual members and £3 for club members was proposed to balance the books. No idea what changed to alter the calculations.

I gather that the £6 proposed increase has been approved at the last National Council meeting for inclusion at the AGM but the minutes for that aren't up yet. 

https://www.thebmc.co.uk/bmc-national-council-minutes

At the Peak area meeting several people raised concerns about widening the gap in cost between clubs and individual members as this may be seen to unfairly load the cost onto individual members (particularly considering that clubs potentially pose a greater liability as there is more risk of a legal issue arising).

There were also various people who seemed to be pushing for assisted locking belay plates to be encouraged/ made mandatory, thankfully this was shut down as being unlikely to actually increase safety.

I'm not convinced that issuing new advice on belaying is going to do all that much as many none committee members of university clubs (which seem to be more likely to use poor belaying technique due to simple inexperience) seem to have little awareness of what the BMC even is.

I had heard £3 provisionally a couple of months back. It would be good if the £6 could be explained but at the end of the day it’s not a lot and it makes sense to future proof the BMC’s finances (I say that as a prudent accountant!). It’s worth noting that the size of this claim just goes to show that BMC third party liability insurance will still be good value for money even after this increase (particularly for club members). 

I highlight, once again, the "culture of silence" we have in the UK about serious accidents and the reasons for them. 

Still not convinced - without the insurance, someone could pursue me for a few million quid if they wanted, but they'd be disappointed when they found out my net worth.

£6 isn't a lot for most, but it's still something like a 35% increase.

Club members already pay less than individual members anyway don't they? I'd rather see parity in membership costs to cover the shortfall.

Sounds like they need a better insurance broker to me. 

Yes, but very little less if you pay your individual subs by direct debit.

The direct debit offer expires after the first year

This is still a live claim which is why there are no details being discussed. Culture of silence doesn't really apply here I don't think. 

Did you mean to address this to me? I agree that parity would be fair.

Club members don’t get individual liability cover (though the club as a whole gets liability insurance) and only get one issue of Summit but otherwise their benefits are the same.

I know that some club members resent being ‘forced’ to being BMC members and paying for it as part of their membership of an affiliated club whereas obviously an individual member can choose.

where you going to live ? you have a largish house but will end up  in shoebox in middle of road

Fair point, but we're talking about the difference of 3 or 6 pounds over 12 months.  Neither would buy you a pint round my way.  Life is far, far, too short to be worrying about such a piddling amount.   

Let's head for the hills and stop arguing about a measly three quid eh?

Thank you to everyone who has commented so far on the proposed BMC subscription increase. The background to the proposed increase is complex, and we are producing a paper outlining the reasoning that will be published on Monday 25th February on the BMC website. I will ensure a link to the paper is put on this thread. The financial details have certainly changed since the February round of area meetings (as we said they likely would at those meetings).

This is a specialist area of insurance and there is a balance to be had between cost and cover. The BMC has used Perkins Slade (now Howdens) for many years and they specialise in this area with many other Sport NGBs as their clients. https://www.howdengroup.co.uk/en/business-products/sport-recreation/

Thats not to say that occasional competitive tendering isn’t a good idea. The issue is now we have a large claim it will affect future quotes from underwriters.

Many BMC members will be unaware of this cover as a benefit. One option would be to drop something that isn’t widely valued though that option doesn’t seem to have been explored

It's worth remembering that we can't all afford to live in the land of expensive beer

A fair point!  I don't think I can either to be honest

Might start a separate thread to moan about the price of beer.  There's always time for that!

Lynn, my comment was dead serious... it sounds like you need a new insurance broker. 

Even a large claim should affect a book that much. Have you tested the market? Have you tested your broker recently by going to tender?

pm me if you would like a name or two. 

However, if there were a plane crash, pilots would immediately start analysing the causes on relevant websites, regardless of potential future claims. 

There is much to be learnt from the aviation industry particularly with regard to human factors in accidents but here is a quite a difference between analysis by pilots who are professionals in a highly regulated industry who are responsible for the public and the typically speculative and distasteful nature of UKC threads guessing mistakes that might or might not have been made by hobbyists engaged in a risky activity. The lessons are better broadcast by more general and less finger pointing ways such as this:    https://www.ukclimbing.com/articles/skills/8_common_climbing_accidents_and_...

If you want proper analysis wait for a formal accident report or coroners report.

Is that in comparison with the offer? So by being in a club your contribution to the BMC is ~£15/year, whereas as an individual I pay ~£34? Why not just raise the club fee to a) introduce some parity and b) raise the extra funds? I'm not in a BMC club as there isn't one local to me and I can't be bothered with the faff that is joining the CC.

I'd raise this at an area meeting but seems unclear when the next mid-Wales one is.

Not necessarily you personally, just the one I clicked on (could have been bottom of the thread?). I'd forgo some recycling bin filler to reduce my fees. Could make summit an add-on?

Many other brokerages have large specialist teams which are more than capable of handling the BMC’s business. Most decent brokers can leverage their preferred markets and work around an exceptional, large loss  

The fact that they’ve been with Howden’s for many years and are swallowing a large increase in premium doesn’t say much for how well the competitive tendering process has gone thus far. 

As I said, I can give Lynn some names in a specialist team if they would like to explore an alternative to hiking prices. 

It's highly valued by all members who've climbed at Cheddar, or any other crag where liability cover is a condition of access.

There is an option available to do that - not sure how much www.thebmc.co.uk/upgrade-your-club-membership_0

Good point. Did Alex and the marketing team get the Access reps to include that requirement in the negotiations?

Oh I meant to the individual membership. So the default position would be no summit, then add summit for £x extra.

Individual members exceed club members and the gap is growing as BMC membership grows and club membership numbers decline. Club members have to pay their club subs on top of their BMC contribution so it is difficult sell and Clubs are good at lobbying the BMC.

Also raising it to parity in one go could be counter productive (not just financially) and provoke a backlash of disaffiliations from the BMC to nobodies benefit. The Alpine Club had a motion to do just this at their last AGM though fortunately it was massively defeated.  

<insert Monty Python clip here>

The incident behind the big BMC insurance claim was reprted in the national press close to the time... the details were not (but it's an indoor accident where the climber decked and with third party liability for the belayer and club, so most probably involved belay error). I don't know about you but I can't remember the last time I visited a wall where all belayers were following good practice. As such I'm not sure there would be anything new to learn from any immediate discussion in this case even if we knew what went wrong.

 The Chinook helicopter scandal shows how opaque some air accident investigations can be.

https://en.m.wikipedia.org/wiki/1994_Scotland_RAF_Chinook_crash

In reply to Shark

As someone with assets who has taken hundreds of climbers outdoors for the first time bouldering, trad and winter routes and introduced climbers to climbing indoors (all mainly in a BMC affiliated club) third party liability was absolutely essential for me and the BMC cover cheaper than any other cover I was aware of. Frankly I'm amazed nearly everyone with assets doesn't regard it as vitally important for any BMC activity. Climbing in particular is an activity with significant risk and even though I try to follow much better practice than the low standards  I too often witness indoors  I still want 3rd party cover, so if something does go wrong I don't risk losing my house etc. The insurance also covers club officials for club liabilities:  at one area meeting I visited this year a club who investigated disaffilating said the extra insurance costs for the committee and members outside the BMC looked prohibitive (even if they could obtain cover!).

On the £3 covering the stated insurance increase, the costs (in the papers provided to areas in Feb on the subs discussion) were said to be not yet defined. Also if many of the subs go up next year (clubs in Jan) and the BMC costs increase this year, one big balance sheet problem is obvious. There could of course be additional factors when the BMC release their paper on Monday.... I  suspect your sensible balance sheet points are what is behind the level of proposed subs increase. 

You'd have to offset those who'd leave the club rather than pay the extra £20 or so - most clubs have a lot of members who never do anything anymore but keep joining for old times sake - add an extra £20 and many will leave. And also club members have the option to upgrade to full membership anyway, to gain the extra copies of Summit and the extra insurance.

A good point - but the majority of BMC members never introduce anyone to climbing anything, and a good proportion aren't climbers themselves but hill walkers who join for holiday insurance or just to support a worthy organisation.

It's not just introducing new climbers: any climbing partner could sue you for an error you make that causes them damages. You might drop something and hit a stranger. Clubs can add organised trip issues, including for some other outdoor sports. Unpaid club introductions by more experienced climbers in clubs is covered.

http://www.bmc-insurance-centre.co.uk/members

Incorrect.  From the BMC website: "As a member of the BMC, either via a club or individually, you are provided with combined liability insurance protection for your mountaineering activities. "

http://www.bmc-insurance-centre.co.uk/members

What club members don't get is the additional personal accident cover which is for individual members only.

Brace yourself to to be amazed. Only 6% cite it as the main reason to join the BMC and I bet most of them are guides of some description

https://www.thebmc.co.uk/media/files/BMC%20Organisational%20Review%20Member... 

Insurance really isn’t very interesting. There’s a reason that Alex and co focus on the access and conservation message. Not saying that people havent got their priorities right but you are generally looking to reflect the wishes of the majority of members who by and large aren’t going to miss what they didn’t know they had and highly unlikely to benefit from. Compare this to the more tangible certainty of a surprise near 10% rise on the back of a rise last April.

Just saying.

Yes you’re right - my bad. Thanks for highlighting. 

I agree most members regard what the BMC does for access and the specific activities they undertake will always be a priority in why they pay for membership but this insurance is an important benefit in risk activities... a lot of activites could be in trouble, especially in clubs, without 3rd party cover. I think the provider and level of cover are sensible to debate but having reasonable 3rd party cover and individaul member personal accident cover are always going to be great value (as we are a negotiating body of 85,000 members). They are also a foundation for the important BMC commercial income of additional holiday insurance. Paid instructors require extra commercial insurance cover.

Most people don't understand insurance, and in particular they don't understand third party liability. Whenever this comes up on UKC there is a widespread assumption that only professional guides could get sued, and that if you injure someone they should just suck it up, it wouldn't be in the spirit of the hills to sue another climber. This ignores that you might be sued by an injured climber's insurance company or next of kin with no romantic ideas about climbing. 

This makes the liability cover extremely important, even if members don't realise it.  If it were to be dropped then I think my club would have to consider very carefully whether it is worth remaining affiliated to the BMC.

Yes but you could lose your house if you have one, any other valuable assets (eg car) and end up with a charge against any future income. Which wouldn't be nice.

It's 35% but that's starting from a low base.

It amazes me how some climbers like to fret over the cost of a pint or two, then think nothing of spending ten times that amount to go away for a single weekend.

Your points do indeed have merit, but the upshot is that in the UK climbing accidents happen and the wider community are not aware of the reasons why that accident happened.

I'm not sure this is a good thing. It's contrary to custom in other areas (e.g. Yosemite), and contrary to UK custom in other fields such as aviation.

Don't you think any insurance underwriter would significantly increase the premium after a massive claim? It was cheap as there were few or no significant claims. Not there's a massive one, which could encourage other ones (it potentially sets a precedent). It's like losing NCB on your car insurance. You can change brokers all you like but it will still cost you more if you have a claim on your policy (unless you were significantly overpaying in the first place - which I doubt the BMC were).

I don't think dropping the third party insurance to reduce BMC membership/affiliation costs would be a good idea. People will end up getting sued in a personal capacity and then people will complain why the don't get third party liability cover 'as standard'! It would just drive up costs for people who do want cover because people would end up having to get it in a personal capacity without the purchasing power of the BMC's 80,000+ members.

You say that people don't value it but it's like that with a lot of things in life - people don't value something because they take it for granted but as soon as it's taken away from them they start missing it!

You mentioned guides - I don't think the BMC third party liability cover extends to people who provide paid services. Instructors / guides have to get special insurance cover for that.

It's a fair point. I think the reasons for the different contribution rates are historical and to do with the sway the national clubs used to have over the BMC, which they no longer do now that membership has grown significantly. The main argument for keeping the lower club rate is it encourages people to join clubs (or rather increasing the club rate by £20 would discourage people from joining or staying in clubs). Local and national club membership is generally a good thing for the health of climbing and walking as popular activities, so I'd say it's a good reason for keeping the lower club rate. I'm not sure it would bridge the gap anyway - there are probably around 5,000 club members so it could amount to about £100k of the £250k needed.

They might do. Or they view the exceptional loss as just that and base their underwriting on the long term claims trends of the account. It is the job of a good broker to market a clients risk in the best way and a large single loss by no means they should be resigned to a premium increase. 

I have no idea how significant a £5m claim is in relation to the bmc account. It might wipe out profit for a year or ten years. Things like that will determine what an underwriter decides to do. 

Accounts like like this aren’t like your car insurance. You don’t have any leverage over the market for a £300 policy. 

Changing brokers isn’t a golden bullet for issues on the account, but it does give you other options that the incumbent might not. Howdens aren’t the biggest name in any market... moving could give you more leverage.

But thank you anyway for trying to explain how the market works. 

Well I’m nonspecialist on insurance but say it’s £15 (which is roughly the current BMC fee for club members) x 85k members. That’s £1.3m a year before taking into account any costs.  So a £5m claim is going to be over 4 years of profits. I get what you are saying about one off claims but I’d have thought the concern is about more people claiming (or trying to claim) now that there’s a precedent of a big payout. Accidents do happen, sadly not that unusual. It’s just that so far no one has successfully made a big claim as far as we know. 

Just to clarify a point in Shark’s post - all members (club and individual) get £15m liability cover as part of BMC membership. It’s the personal accident cover that applies only to individual members. 

The answer to Allan’s original question is fairly complicated and the detailed paper currently being worked up (as mentioned in Lynn’s post) sets out to explain this, it’s possible it will be completed tomorrow, if not it’ll be Monday. The premium situation has been changed daily so it’s been difficult to deal with in the time available before the AGM deadline. For example just today our insurers advised us of a further premium increase - an additional +£20k per year -payable immediately, this time for the £10-15m excess amount with Zurich.

In summary the proposal for a £6.00 increase is the result of a combination of factors including: 

a. The scale of the claim and level of premium increase being sought by our underwriters. 

b. The fact the new rate kicks-in this month, meaning BMC reserves will have to be used to cover the shortfall (i.e. because subs can’t be increased in time); with will generate a 2019 deficit of minus £125-150k.

c. The way subscriptions are treated in the accounts. This refers to deferred subscriptions - essentially a payment has to spread evenly across the 12 month membership period. The detailed paper will explain this further or an accountant type (Misha perhaps?) may like to chip in. 

d. The need to rebuild the BMC’s cash reserve, amongst other things to deal with further potential insurance increases arising from claims.

e. Having some additional resource to cover the ever expanding list of new and improved work climbers and walkers want from the BMC. 

Finally, the general word from our underwriters is that we’ve had it cheap over the years and that the times they are changing. 

Cheers 

Dave

If it's still a live claim as opposed to resolved, then why the proposed BMC price hike?
Surely, if it's still live, the actual amount isn't known?

But they already know there will be a significant increase so it’s sensible to increase the subs now. Sounds like the higher premium is due to be paid shortly. If they leave the increase till next year, they will have had a year of higher costs without higher income to compensate, so at the very least a cash flow hit and probably a permanent hit to reserves (I’m not very clear about the various year ends involved and the timing of payments and receipts so can’t comment on the accounting point but I suspect that if they wait a further year it will effectively be a permanent hit). 

Because, if voted for, the subs increase wouldn’t take effect until Jan 2020

A claim still has to be disclosed and will effect renewal premiums which will take such claims into account in risk calculations by the underwriters

Yes I appreciate all that. I would like it to at least be questioned where the perceived value to the whole membership is vs the actual cost rather than accept we’ve always done it that way so let’s carry on. In fact there may come a point in an increasingly litigious society that no one will underwrite a meaningful policy for our activities if there is a history of multi million claims.

Another reason to discuss it to highlight this insurance exists and what it’s real value is. It’s illuminating that Howard J above says that he would give serious thought to his club disafilliating if the insurance was withdrawn

I said ‘guides of some description’ by which I was thinking of those filling in the survey who like Offwidth are tutoring novices and those doing Mountain Training courses who are required to join the BMC 

Yes sorry. Howard J pointed this out above as well. I’d assumed that the club members only got club cover for members on club activities rather than the double benefit of club cover and individual cover.

Personal liability is most likely covered under a home contents insurance policy, so many climbers may already have it. 

A £6 increase means BMC subs could take up the major part of a club fee for smaller clubs, which may result in them "disaffiliating".   Perhaps clubs should be able to offer BMC membership as an optional add on, a bit like running clubs and their national body.  

Also a fair point - I understand the historical background and I can see how an increase in £20 to fees would likely be the end for a lot of club members, and ultimately lead to lost funds. Don't disagree that club membership is good for climbing/walking nationally. Thanks for actually doing the maths as well.

However, it still feels remarkably unfair that I'm paying more than double the rates of a club member for magazines I neither want nor read. Maybe a phased increase could be a solution? i.e. an increase of £2/year for club members over the next 10 years, plus equal increases for individual and club members accordingly, would lead to parity within the decade, without feeling excessively painful for club members each year. 

Regarding the current increases, I appreciate that there is a need and I'm not averse to paying a bit more.

All very true. And true of any other activity as well, I could hit a fellow cyclist by losing control of my bike, trip over and land on a stranger while out running. OK as a BMC member I've got insurance, but that's a by-product of being a member anyway, and if it were an optional extra then I wouldn't have bothered.

If I worried about every risk then I'd stay at home and watch East Enders

I never realised this, but I checked my policy and I do indeed have £2 million personal and public liability insurance. The only exclusion for anything I might actually do would be cycle racing (foot races are covered).

What's interesting about this specific case is that (and there is plenty in the Press about it for those who care to Google) the "victim" doesn't harbour any resentment against the "perpetrator", and as such I suspect he only sued *because* the "perpetrator" had BMC insurance due to the huge costs that were going to face him throughout his life now.

To be honest I don't mind an extra 6 quid to ensure someone in a climbing accident was able to make his new life in a wheelchair that little bit less rotten by being able to fund his house being converted professionally for his needs, for example.   It's two pints.

A thought perhaps, though - if the cost of membership is psychologically a bit high on an annual basis, time for monthly direct debit?  £40 a year does feel like a bit of a whack, but if "membership is only £3.50 per month" that's a pint a month, which is a pittance.

As for "belaying advice", could we see the BMC start deprecating non-brake-assist devices?  (Though of course we don't know what device was involved - it could have been a cack-handed lowering off with a Grigri...)

"most likely" is no consolation for a volunteer club 'official', though, who has to either shoulder the risk or do the balls aching verification - remembering that the club (and its officials) can be liable, not just an individual.

It already does for most clubs which don't generally have any significant overheads.

"It's two pints."

*One

£6 is two in 'Spoons.  I was talking about the full proposed increase.

The day that the BMC introduces rules about what equipment I can and can't use, is the day I leave the BMC!

Why do you want the BMC to get people to stop using an unassisted belay plates. Do you have any evidence that this would reduce incidents? 

I would be surprised if they introduced rules about anything, but one of the following two (or both of them) has to be a possibility if there is found to be a large number of accidents for which the third party cover is paying out for that relate to people being dropped through inattention rather than device misuse:

1. Advice that a brake assist device is preferable

2. Exclusion of use of non-brake-assist devices from the insurance policy

And I say this being someone who does not use a brake-assist device.

There is plenty of evidence that they do, yes.  But I would expect the BMC to research this properly before making any such decision.

Right you are

Would the club need to do a verification? The club/club officers would still be covered by the BMC scheme, but personal liability (the reason for the subs increase?) and other individual BMC "benefits" would be down to club members choice. 

Yes, some climbers may have 3rd party cover from elsewhere, but not all will.  As a club climber, I take some comfort from knowing that I am protected, not only if I cause an accident but also that the people I climb with most are also covered in the event that they cause an injury to me.

My real point is that this is an important and valuable benefit of BMC membership, even if most members don't realise it.  There are other reasons for a club to affiliate but this is an important one, and one we emphasise to our members when they question the benefits.  If the subs are going to rise by a significant amount they are likely to raise that question again.

Here's the link to the detailed paper I mentioned:

https://www.thebmc.co.uk/media/files/Paper_A_Membership_subscriptions.pdf

Since such clubs can't obtain cheaper insurance presumably you think they will proceed without insurance. The prospect of the only people willing to volunteer to run clubs being those having no assets is rather worrying. Having said that I do hope the BMC proceed with this in a way that mitigates against unfair damage to clubs because of the timing. I do think the insurance situation in the BMC needs looking at.

Clubs to me are vital for the good of UK mountaineering as they punch well above their weight in the good BMC volunteer work done quietly by thousands,

How many of those house insurance policies get tested against loss adjusters on climbing accidents. Even the AAA and BMC policies have faced issues here and they are defined specialist policies. I simply wouldn't trust house insurance policies unless I have clarified the postion applies to the specifics of my climbing and mountaineering in writing.

Unlike Simon when I chose to engage in risk at Agden Rocher later today the risk is part of what makes the visit attractive.  I still want some financial security in the unlikely event things go horribly wrong: I don't find the risk of being uninsured very life affirming at all.

A link would be good (genuinely interested and cant get much out of google scholar) .

This might be a start:

http://www.climbingbusinessjournal.com/abd-policy-aims-to-prevent-accidents...

(Read all of it, there's also a link to a paper by the DAV).

The reasons for most avoidable risk are really to do with dangerously lazy belaying. A standard belay device is fine if you use it properly and pay attention to your leader. Eveything in climbing risk analysis shows losing focus when things seem safer (like indoor walls do for some) is something to avoid. Not facing and challenging lazy belaying but recommending a more fail-safe device is not a full solution. However I can see some walls in future might insist on grigri (or similar) use alongside tests.

https://www.alpenverein.de/chameleon/public/d4ce5dd2-3456-0e69-f1e9-877eee9...

That discusses error rates with various belay plates which may be of interest, it's a little bit dated but the design of things like the GriGri and the Smart haven't changed since (except for the GriGri + but I'm yet to see someone using one).

As I mentioned in my earlier post, there were questions at the Peak Area meeting about making assisted braking devices mandatory at walls, the general feel of the meeting was that this may not improve safety (due to people being forced to use an unfamiliar device).

Thanks for the paper Dave, I think it will just sneak into our newsletter this month to explain what's going onto members.

It may already have been mentioned but surely many clubs have members  who would never have paid for individual BMC membership anyway and are largely inactive. So the BMC may end up with more money than if people paid individually (also possibly simplified admin for group membership) and one assumes the inactive members pose little insurance risk.

The inactive are mostly probably paying to support the club and/or BMC despite not getting full benefits. There is a risk the £6 might be taken up in admin costs if you treat people differently and potential liability on clubs if the members lie about inactivity. The basic insurance is also a platform if you take out BMC travel insurance for a foreign walking holiday in the mountains.

Good points, although it is far more likely that when climbers are injured fault will not be attributable to someone else - does anyone have £5m PA cover?  (£10k with BMC is not going to go far!)  

I would guess that in most small clubs the majority of members are not active, so whatever the benefits, they might have let £20 roll over but baulk at another £ 6,7,8..

Yes, but that's about personal accident insurance, rather than public liability insurance?

That's not what I'm saying.

I don't agree. 

If you fall off and injure yourself what insurance is going to give you a £5m pay out?

Thanks!  

My understanding of this is that club members are jointly and severally liable which means you really don't want any members in your club with significantly lower cover.  

The GriGri+ does remove the dangerously counterintuitive "failure mode" of that device, in that instinct is to grab hard to stop something and with a classic GriGri that does the opposite.

This is an interesting one - presumably it would only happen during an initial familiarisation period with a new device, and because it's not exactly a surprise climbers can help one another (when in a three) by tailing the rope, for instance, if they felt uncomfortable.  New novices would learn with an assisted device in the first place so this wouldn't apply.

As I said I don't presently use a brake assist device (I have a GriGri 1 but find it horribly cack-handed; if I switched to one the Mammut Smart would be my preference, with the Click-up second).  But I do see the strength of them, and if the ABC decided to switch all walls to a policy of assisted devices only I don't think I'd put up much of a fight, and I indeed suspect that will happen at some point - my guess would be that it would be about 5-10 years away.  Meanwhile, the argument "but if we make X safer people will pay less attention", while it does have *some* mileage, is now discredited in places where safety *really* matters - the railways and air travel - the idea of making things "passively safe"[1] is more appreciated.  This is because there is an acceptance that humans are fallible and *will* lose concentration from time to time rather than trying to suggest humans should try to be perfect.

(There's still no excuse for actively sloppy belaying with any device, e.g. not holding the dead end when using a brake assist device, and walls should still pull people up on this exactly the same regardless of what they are using)

Mind you, the UK is better than the US at that - do they still belay with hands out of the lock-off position by default?  That makes the mind *really* boggle...

[1] i.e. safety is the default, not something requiring an action to be actively taken, even if that action normally is taken.

Yes, looking at BMC website, liability cover for BMC, their employees, clubs and their members, and individual members all seems lumped together.    

There is, of course, an irony in that at the last AGM members were told they would be asked for a £3 subs increase unless they voted for 'Option A'. If they did all would be hunky-dory and there would be no need for a subs increase.

Now, seven months later.......

I don't think I can be alone in finding you even bringing that debate up in relation to this pretty tragic accident and insurance claim in pretty bad taste.

3 pints in my local Spoons, but I’d rather give the money straight to the BMC than put  it in Tim Martin’s pocket.

Sorry? I have absolutely no problem with the insurance claim! Just how did you read that into my post?  If someone has suffered life changing injuries then they deserve a payout. I think you might apologise?

I was simply pointing out an irony.  I am not privy to any of the current finance figures but the proposed subs increase will amount to c.£510,000 p.a. This to cover a potential insurance premium increase of £200,000 rising to £250000.  We were assured last year that if the Sport England funding was obtained then no subs increase was required.

I should make it clear that I have nothing but admiration for Graham Richmond (BMC treasurer) a man of integrity and humour. Who did make some uncomfortable estimates of the actual cost of the organisational changes to the BMC.

I am flabbergasted, and hurt, how you managed to interpret my post as unsympathetic to the injured person. I was focussed on the subscription increase.

Fair points. 

I’d be amazed if home contents insurance covers it. Climbing is a risky activity with a completely different risk profile to getting burgled or taking part in any ‘everyday’ activity. Besides, not everyone has home insurance. 

May be a phased approach would work. Having Summit as a paid for opt in would be a good idea as well. 

As I understand it, the club as an entity is not covered, it’s the individuals who are covered. Are you saying people would go to an opt in system and committee members would have to opt in? That would be an admin nightmare. 

That’s a bit optimistic. We all know what insurance companies are like! There is probably a carve out somewhere in the policy or indeed based on general insurance law principles. I wouldn’t fancy my chances of claiming under a household policy. 

Personal accident is one thing. We know the risks. Being dropped by a belayer or someone dropping something on you from above (dislodging a rock etc) is something you can’t control and it can be pretty catastrophic. These are the kind of claims we are talking about here. Of course you might say I’ll never drop anyone or dislodge a rock onto anyone so I’m fine. May be so but all sorts of things can happen, particularly in more adventurous locations. And if you’re a club official, particularly in a club with club huts, you’ve got all sorts of other potential accidents and claims to think about. 

Just trying to catch up in this thread:

I can see that liability insurance is a very good thing for all BMC members (individual, or club); but why is personal accident insurance cover added by right for individual members?

Looks like in this recent claim you would be short by £3m

Perhaps this should be optional - I don't really care for it myself.

The simple finance logic is the fee rise would have had to have been even more if the current option had been rejected, as Sport England income would also have gone.  Either option required governance changes that some would regard as uncomfortably expensive to implement, probably not a huge difference between them, especially when compared to this extra £400k+ insurance impact  (due to insurance and the accounting effect of deffered subs according to Dave paper). More Sod's Law, than irony.

I'm really glad to see support for clubs where AGMs fall at a time that could have left them additionally financially compromised.

No I was referring to both but maInly 3rd party. The BMC fully covers my 3rd party liability which is the most financially scary (an othewise risk of a big up-front claim that could wipe out all my assets).

The Oread committee has recently looked at our legal status, it seems that as an unincorporated members club the insurance covers the individuals (as the club is not a legal entity), in something like the CC the club itself is also insured.

I think that someone looked at making Summit an opt in (specifically on the context of 2 member households) and concluded that it would cost more to administrate than it would save.

Losing the insurance cover would be a total painpo deal with for most clubs!

And losing the personal accident cover might mean more liability claims?

We are probably just back to putting it up.  I still reckon monthly direct debits are worth considering, though, as that would make it more “sign up and forget” rather than something you actively pay once a year.

I’d be amazed if it didn’t.  If liability premiums were affected in same way as burglary and postcodes,  insurers would look at a whole host of other factors, such as dog or bike ownership – every day activities, but probably far more claims than climbing?   You’d still need to check the wording.

As far as I can work out from the BMC site everyone's covered,  including clubs whether incorporated or not, plus your dog, and it appears to be under one blanket liability policy along with the BMC and their employees.

I thought if it were possible to have a club opt in/out for BMC membership it might help settle the issue that many club members appear to have with compulsory BMC membership, as well as the proposed subs increase. I wouldn’t have thought the admin would be too much of a problem, but as pointed out by others could lead to issues with possible gaps in cover. 

I would be very uncomfortable being in a club where all (active) members weren’t covered by third part insurance. If an uninsured member causes an accident on a club trip, the injured party might clailm against the club instead. I’m not saying that such a claim would succeed (I have no idea) but it’s certainly not the kind of hassle any club wouod want. 

Monthly DD would probably cost about 25p a month, so that would be another pint a year (or half pint in London).

It would, but spreading the payment allows it to be a bit larger without people noticing.

I suppose there is always the possibility of hassle whether club members insured or not - I wonder what would happen if a BMC affiliated club hired a CC hut and it burnt it down through some negligent act, but the individual responsible couldn't be identified?   

Well I wouldn't, as I'm in the BMC. But even if I weren't, claims like this tend to be set at a level that the insurance being claimed from will pay.

Well there's definitely no exclusion in the policy. But yes, I know what insurance companies are like! I once claimed when my conservatory roof was blown off. This was rejected because the wood was supposedly starting to rot internally, which there was no way of telling without having the roof removed every year to check. So a reasonable starting point seems to be to assume that every claim will be challenged for any reason they can dream up...

I did get confirmation in writing that my (years ago) Direct Line home policy would pay out if I cycled into a car, for instance.  But I do agree, insurance companies do try to get out of anything in any way they can.

I have long wondered if it'd make more sense for us to be more like Germany, where people take third party liability ("Haftpflichtversicherung") insurance more generally as a thing in its own right.

I don’t know if BMC insurance would cover damage to another club’s hut. The club that owns the hut should have appropriate insurance, same as any commercial premises. 

It could be used as an option for those that wish to spread the cost and are prepared to pay extra for it.

Forcing it onto everyone so that they don't "notice" is a bit shifty.

Had a look at the paper. I don’t disagree with the overall message but think it could / should be clearer on a couple of points.

The principle of deferred income is correct but it is only a timing differnce. The positive impact of the subs increase for individual and student club members will be spread across the two financial years to 31 December 2019 and 2020. However in the context of over £1m of reserves and presumably a similar level of surplus cash, this timing difference is negligible.

Incidentally, the calculation for Scenario A in section 7 is wrong. It should be an 8/4 split, not 9/12 - as can be seen from the diagram.

What I’m not clear on is the additional income of £485k referred to at the end of section 7. It says that’s for 2019 and 2020 but it looks like one year’s worth (80k members x £6 = £480k). So over two years I’d expect more like £960k in cash terms. I suspect £485k is the accounting figure and it’s lower due to the deferred income but even then it looks too low because over 2019 and 2020 I’d expect a full year’s £485k (being the 2019 increase) plus £85k (being the element of the 2020 increase recognised in 2020).

A further observation re club members. If £42k is the impact of deferring one year’s worth of £6 increase for a third of club members (it says clubs but I assume it really means club members), that must be £126k for all club members (incidentally, that suggests 20k people in affiliated clubs). Given that the clubs are being asked to pay from January, there is no deferred income on this £126k (the £42k is just a debtor, which still counts as revenue in 2019). Which raises a question over the £85k / £400k split. Should it actually be £211k / £274k?

This is dull accounting stuff but the upshot of it is in accounting terms the surplus across 2019 and 2020 would appear to be higher than the £53k mentioned in section 4. Of course I may be missing something here as I don’t have all the details.

And in cash terms (ignoring the deferred income timing difference) the surplus is higher still.

From 2021 the additional annual surplus, in both cash and accounting terms, will be around £215k a year (additional income of £485k vs additional insurance costs of £270k).

Now as a prudent accountant I’m all in favour of the BMC running a surplus, especially as the insurance premium is likely to increase further, but I think it’s important for the BMC to be clear about (1) the projected additional annual surplus and (2) what that money will be used for (I’m sure there are many good ways to use that money; the additional costs stemming from the org review will also need covering but it’s not clear what these costs will be).

I'm not sure if I'm misinterpreting your post Misha so please excuse me if I've got the wrong end of the stick.

The subs increase will only be able to kick in for club members from January 2020 (or October 2019  for student clubs I believe). Individual subs are paid annually on the date of joining the BMC so we can probably assume that nearly half of individual members will have renewed prior to the subs increase taking effect. Perhaps 30,000 members will wind up paying the increased subs in 2019 if your estimate of 20,000 club members is correct. 

You are right about clubs not being asked to pay until 2020. Have updated my earlier post below but this doesn’t change the key points. 

Updated post as can’t edit it. 

Yep, I wasn't disagreeing with any of your points, I just couldn't see anything about the subs renewal date for clubs hence my question. At best I have a fairly cursory understanding of accounting.

I wonder if there is any members on UKC that are insurance brokers that would dare to advise on what individual policy costs would be for liability insurance 

I'm surprised that this thread has been so quiet.  With the BMC AGM approaching and many clubs also having to make decisions at their own AGMs can I assume that everyone's decided they are OK about this?

I have some reservations.  Not so much about the current proposals for dealing with the situation we find ourselves in, more surprise that one quite modest claim has provoked such a reaction from the insurer.  In the greater scheme of things this is not an outrageous claim and surely something equivalent should have been assumed as part of the risk model.

This isn't my area but does this suggest something about the way in which the risk was underwritten?   

Having found out a lot more about it, I am satisfied that the proposed increase in the premium is actually a good deal, ie it could have been a lot higher with other underwriters. The position is pretty complex (a lot more so than I imagined). I believe there will be some further comms on this from the BMC once a few more open questions have been addressed with the brokers and underwriters. Watch this space...

I wouldn’t describe a c. £8m claim as modest by the way.

The cost would increase by £200,000k in 2019 (ie cost now + £200,000)

The cost would increase by a further £50,000k in 2020 (ie cost now + £200,000k + £50,000)

It’s worded quite strangely but that £200,000k needs to be counted twice, hence £450,000

A couple of questions in the ‘Devil’s Advocate’ vain:

- In which context is the BMC involved: solely through the club involved or the wall too?

- Is it just the BMC footing the bill (as opposed to the wall and university involved)? If so why?

- Will we see the details of the claim to decide if it has the backing of the memebership to settle (before a price hike and a Hobson’s choice of pay vs BMC bankruptcy)?

The BMC has been acused of opaque practice at the top and steamrollering it’s memebership in the past couple of years. A good / better explanation might be needed to convince everyone. The incident itself is crap and I’m sure most climbers would be happy to support those involved if it’s handled right. 

The BMC is involved as the person involved, and their actions, were / are insured via the BMC liability insurance.

Because the person causing the accident / incident is insured by the BMC.

The award has been made against the BMC's insurers by a court. The BMCs policy costs will rise as a result of this being added to the claims history. The BMC isnt paying the £8m, their insurers are. The choice is between accepting a price hike for the policy in the future, and not offering the insurance cover in the future. Which would not be a clever idea.

The BMC has been wrongly accused on many issues over the last couple of years (rightly on a couple of issues) but this one is not up for negotiation and i'm not sure how you need a better explanation for an insured individual suffering life changing injuries.

The BMC is not a party to the action, it essentially resells the insurance as part of the membership package. The claim will be at an early stage. It would be usual with a claim of this size to sue all parties that are potentially liable. I very much doubt that liability between the parties has been resolved yet, it sometimes takes years with claims of this size. The "bill" would be footed by the insurers/ underwriters.

No, the members have no right to be involved in any litigation to which they are not a party. An insurer also usually reserves the right to handle the claim as it sees fit in order to minimise its own losses.

There will inevitably be a degree of opaqueness where ongoing litigation is concerned. The parties to the action (which does not include the BMC) are protected by legal professional privilege  - they don't need to tell the other side, or make public, discussions between the parties and their legal teams and any advice given. All the BMC can do is explain what happens to the insurance premiums as a result of the claim.

You seem to understand the facts and process pretty well, so I'm somewhat comforted that you think the numbers add up.  However, I'm still a bit surprised at the scale of the increase in premiums on the basis of a single claim (maybe 'modest' was underplaying it but surely it was foreseeable?)  Usually insurers complain when they have an unexpected run of larger than average claims, but I would expect them to be able to weather a single claim without the panic this seems to have caused.  

My wife works for a global insurance broker . Premium rates are volatile at the moment and the market is going through what she describes as a hard market with premiums rising everywhere even for good risks. 

Its a cyclical market. Lloyd’s announced £1 billion of losses for last years. 

This will impact on the BMC as well. 

Yes the justification is that it’s more than to cover the rising cost of the insurance premium it is also to repair the reserve and meet rising costs on governance - a new Project Manager for the ODG and a Governance Officer for example - despite cuts to the Marketing budget and other cost saving exercises mentioned in recent Board minutes.

Personally I would be doing a range of other things in response but that’s another whole story...

The context is that there's a long history of very few and fairly small claims - so the premiums have been low. This £8m claim is pretty much 100 times larger than the previous largest claim (that's not a typo). So as you can imagine the insurers have had to respond to it in the way that insurers do...

Prices will rise but the rate of increase is worrying.

For those wondering why fuss over £6, lucky for you. You can go for a pint without considering tomorrow's bus fare. Imagine that you're scraping by on a barely adequate income and made a sacrifice to sign up last year. That 6 might feel more like 60. Incomes are very unequal and what is easily affordable for many will feel prohibitive for others.

Keeping subs increases to a minimum is important. It broadens our demographic. Interest based clubs have an important role in helping to heal social division. There are lots of different ways in which members contribute other than purely financial. Many who joined a club skint have been very supportive when their fortunes changed.