Playing Smart changelabsolutions.org | kaboom.org 63 In Paradise City, the three groups – the school district, Parks and Rec, and Fit to Play – should begin by assessing their insurance coverage, asking these questions: Do the parties have insurance? (Follow-up questions about the school district’s insurance might include whether it has its own policy, is selfinsured, or is part of a risk pool. A school administrator should know or be able to find out this information; the school’s risk manager would also have this information.) Does the insurance cover the types of activities the parties want to sponsor? Would there be an increase in cost to extend coverage, and if so, by how much? With this information in hand, the parties want to determine who is best equipped to assume responsibility for the risks associated with after-school use of Paradise High and/or the Plunge facilities. Depending on the additional cost, the school district might agree to take on the risk of joint use at Paradise High under its insurance. Or Fit to Play might carry its own insurance that would cover the programs it wants to run on school property. A large nonprofit such as the YMCA would likely have its own insurance, while a small nonprofit might not. If it’s uninsured, Fit to Play could try to purchase a rider on the school’s or the city’s insurance. Another possibility is that Parks and Rec could decide to operate Paradise High’s facilities as a public park and cover the proposed activities under its insurance.101 If Parks and Rec wants to allow the school district the reciprocal use of the Plunge, the same questions would be asked: Which party’s insurance will cover this, and which party wants to assume the responsibility of filing a claim if someone is injured? Indemnity An indemnity clause is a provision in an agreement between two parties stating that one party agrees to be responsible for any liability the other party might incur.102 While insurance should cover a claim that arises within the scope of the insurance policy, having insurance does not mean that the school (and/or partner) cannot be named in a lawsuit. Indemnification is an additional protection that can cover costs outside the insurance policy. Because expanding access to existing school facilities is substantially less expensive than building and maintaining new facilities, a city may find that indemnifying the school district for any potential liability is a cost-effective strategy for increasing local opportunities for exercise and play. In Paradise City, for example, Parks and Rec might agree to take on the risk of liability associated with the use of Paradise High after school hours. The parties would then include an indemnification clause in the joint use agreement, in which Parks and Rec agrees to indemnify the school district.
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