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Feature - Fun at a premium

Insurance industry woes put the squeeze on adventure activities



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"Insurance availability and cost is really our biggest issue right now," he said. "And it’s not just rafting that’s been affected, this is going to hit all of us. I think we’re going to see rates go up across the board."

Leighton does see the need for rate increases from the insurer’s point of view, but believes the perception that rafting is a dangerous sport has worked against his industry. The adventure tourism industry was hit first and hit hardest with increases because of that perception, he said, which is unfair.

According to Leighton, there is currently only one company in Canada that is offering insurance to rafting companies.

He expects the insurance market to recover in the next year, and that other insurance companies will eventually get back into the adventure tourism market. When the level of competition increases, he believes rates will go down for operators.

The latest increase to his premiums did not take Leighton by surprise. "I knew it was coming because I work for the mountains during the winter, and a few of the insurance people we deal with in the ski industry were saying to us ‘get ready, because it’s going to happen’. We knew it was going to go up, but we didn’t know how much."

Whistler River Adventures was forced to raise its prices just to cover the added cost of insurance, said Leighton, who worried what effect that might have on business. The company still had a great July, to his relief, although the spring could have been better.

"My feeling is that the people who want to go rafting still go rafting, and price isn’t a big deal," he said. But it could be a factor for some resort visitors. "If someone came to Whistler from the Interior for instance, who was making Interior wages, and they walked in to our office to check out the prices, they’d be flabbergasted by the costs."

In addition to the downturn of the insurance industry, rafting companies have also been impacted by new federal legislation called the Marine Liability Act of August 2001. The Act was created after a glass-bottomed boat on Georgian Bay in Ontario sank while on a school trip, resulting in the deaths of two children.

Under the Act, marine operators were no longer allowed to ask customers to sign waivers, and were forced to carry $350,000 in insurance for each and every person in a water craft.

The Act was non-specific, meaning that it could be applied to canoe and kayak rentals, jet ski rentals and river rafting. No distinction was made between different types of watercraft.