Insurance

[charrbq]

[quote]
Why do we need a loss leader? Have you looked at our books lately? Are you aware that we just paid Fran Am probably upwards of $6 million to settle a lawsuit of which a large portion was not covered by insurance? Are you aware we've just drawn to the max on a $600,000 LC incurring debt service yet we're leding $300,000 to Pro Racing at 4%?


Yes, I'm aware of it, and I don't like that Pro Racing is loosing money, too. But Pro Racing is still needed. It's where we started and where we gained recognition and where we still gain recognition, even though not as much. It does need to be managed better, but I wouldn't know where to begin on that thought.

I suggest that before you jump down someone's throat screaming that they are unaware, you look in the mirror and check that guy out first. Your "suppose" figures are usefull only in high school math lectures, and your inuendo does your cause no good.

[Mattberg]

And the risk to us, as members, if the house of cards (as you see it) comes tumbling down is what?

.........drum roll......NOTHING. Just that the SCCA goes away. For my $100/year or whatever it is, I am glad I am paying them to take care of this stuff. If SCCA goes away because they mismanged my $100, someone else who has a better model will spring up to take over.

I just don't get the reason for all the angst over where my dues go. I'm happy with what I get (a good mag, and road racing basically whenever I want it) for my money. I also, like Jake, beleive that World Challenge is a good investment. It's about the only time I ever see the words "SCCA" on TV or in the press.
[/b]

Jeff, I too am happy to have someone managing things for us for such a small fee. I just sent in my check for $150 without hesitation. But how would you feel if you got in on a group purchase of race wheels and then the guy who organized it, without telling anyone, used a good portion of the discount to get himself a free set?

Club racing on its own looks pretty darn healthy to me from what I see on the books. Especially considering the many years of declining participation. First, I'm a little angry that they deceptively make it look as though it's not doing that well, and I'm even more insulted that the BoD calls Solo the "cash cow". Second, and more importantly, why should a good thing (RR) be so heavily burdened by a different and entirely independent department(s) within the club? Why not let each department pay their fair share and let the chips fall where they may?

I'm also uneasy in principle, on how the operating statements and financial reporting is carried out. It is extremely misleading and seemingly intentional. Just as an example, they assign all club racing and Solo contributions to their respective accounts on the income statement for everything from sanction to license fees without exception. By the book. But, when it comes to insurance contributions, all of the sudden they change accounting method and there is no breakout or departmental assignment even though the proceeds are collected and accounted for separately like all the others. Even worse, they then assign no contributions to either department's income or expense accounts and assign it all to the Topeka admin account as a pass through! It's arbitrary and random. That then allows them to zero out the category on both sides of the balance sheet and conceal the premiums paid in by each department. It's this kind of "random" accounting that keeps everyone in the dark about what's really going on and keeps us paying more and others paying less to go racing.

There's too much apathy about how these things are being handled or should I say how we road racers are being "handled". Road racing's value to the club is consistently discounted and your comments perpetuate officials' attiude towards us of "we can do anything we want. Racers will always pay". There shouldn't even be any talk of financial trouble if it were just road racing. Sitting back and accepting it because you're happy enough isn't helping anyone or anything, it only allows it to continue. There are places in the country where entree fees up around the $400 mark. We need more cost control, better representation and less of our contributions wandering off into unrelated areas that serve us no benefit.

[lateapex911]

But how would you feel if you got in on a group purchase of race wheels and then the guy who organized it, without telling anyone, used a good portion of the discount to get himself a free set?[/b]

Bad example, Matt...if he said i was going to get a set of wheels for a price, and I liked that price, then how could I complain?? HE did the legwork, HE negotiated the deal, HE paid for the phonecalls, and so on. HE is in the position to recoup his time and money. Fair enough.

There are places in the country where entree fees up around the $400 mark. We need more cost control, better representation and less of our contributions wandering off into unrelated areas that serve us no benefit.
[/b]

But again Matt, high entry fees are a terrible example, and may have NOTHING to do with your theoretical point. Entry fees at Lime Rock are up...way up...to almost $400. Why??? Because LIME ROCK is up...way up...to $44,000 for a Friday/Sat weekend. That's right....somebody's yearly salary is being paid for in two days, LOL. IIRC, the price two years ago was #23,000. So, perhaps the connection is increased rental costs? Sure is in this case.

[gran racing]

There are places in the country where entree fees up around the $400 mark.[/b]

This is seperate from the SCCA National monies. At Lime Rock Park in CT, the entry fees are now upto ~ $300 for a single race weekend, but that's primarily due to the amount the region gets charged for the track rental.

[JamesB]

This is where things become a bit tough. One reason I became an SCCA member can be attributed to SCCA's World Challenge. People watch the racing and learn about SCCA, so there is value to it.
[/b]

Dave I am not saying pro should go, I am saying I would like to see them get more return on their investment dollars. I love World Challenge and I want to see it continue. But even friends who live within say 3 hours of a track usually never hear any local advertising to get people in the seats. but when nastycar rolls into town the have ads all over the place.

So I would just like to see pro racing do a little more to fill some seats which though doesnt earn them much, still earns more then nothing.

[Joe Harlan]

It really doesn't matter if you agree with Matt or not on his delivery of the message. The Message is we have a BOD that has lost our money. It is not the 100 dollars a year we pay in dues. It is the fees that are charged to our regions for sanctions and insurance. I personally do not want to see a single program go any where. Pro and Solo and Ralley all have a place but they all need to carry their own water and share of the overhead. It is fine to prop a bad year or two up from time to time but road racing has carried the water for everything in this club for far to long. We need to get qualified business people on our National and Local BODs.

[Bill Miller]

Yes, I'm aware of it, and I don't like that Pro Racing is loosing money, too. But Pro Racing is still needed. It's where we started and where we gained recognition and where we still gain recognition, even though not as much. It does need to be managed better, but I wouldn't know where to begin on that thought.
[/b]

Chris,

Please explain how the SCCA started w/ pro racing.

[Mattberg]

Jeeez Jake, all you ever want to do is start an argument versus addressing the issues. Instead of criticizing analogies why don't you comment on the topic.?

What about Solo not paying for their own liability insurance? What about road racers footing that bill? What about stupid things like road racers being FORCED to buy a GCR and Solo gets it free on-line? Two year belts? Passenger side window nets? How about no license fees for Solo and ours go up every year? How does that affect the insurance they're not paying? What's the risk of a 23 year old with five accidents on his driving record and a DUI getting in a Viper in a public school parking lot with 200 people standing around?

Why can't you see what's going on? This is an autocrossing club now. It's all about them not us. We get whatever the minimum is they can give us and they take whatever they can extract from us down to the last red cent. This insurance crap is absolute BS and should be stopped. Let them pay their own damn bill. Take $20 dollars off every one of our entry fees because that's about what it adds up to. And you are worng about the entry fees. Check the insurance premiums charged to the region for each sanction. $46 per driver is just insurance.

All I ask is that each department carry their own P&L and GL. Is that asking too much?

[lateapex911]

I criticize analogies because they are what you base your case on.

Perhaps I am not clear, but I haven't seen the proof or the actual numbers that make your case.

Not only that, I am not so sure that what it costs me for fees and such is really all that much, and I haven't been left with a feeling that I'm getting screwed, so I honestly don't pay that much attention to it. Bigger fish to fry, and all that....

Besides, "All I do is..." work on commitees trying to make racing better.....if you'd like, I can stop wasting my time there, and start whining on the net about things I really don't understand completely.

[Mattberg]

I criticize analogies because they are what you base your case on.

Perhaps I am not clear, but I haven't seen the proof or the actual numbers that make your case.

Not only that, I am not so sure that what it costs me for fees and such is really all that much, and I haven't been left with a feeling that I'm getting screwed, so I honestly don't pay that much attention to it. Bigger fish to fry, and all that....

Besides, "All I do is..." work on commitees trying to make racing better.....if you'd like, I can stop wasting my time there, and start whining on the net about things I really don't understand completely.
[/b]

The rates are published on the SCCA web site. A sanctioned road race has a minimum insurance premium of $4100. A Solo event is $90 with no liability surcharge. Pretty simple. THere is also a per car breakdown without liability. Road racing is $31 per while Solo is $4.50 per. Those are the facts.

[tom_sprecher]

Hmmm....

Road racing. 120 mph+, with lots of traffic and concrete walls, workers on the track, multiple day event, $31 a car.

Solo racing. 70 mph max, no traffic or concrete walls or workers, for one day, $4.50 a car.

Seems like a subject not worth the time....

[JamesB]

matt you only have half the facts, you always have since the start of this thread.

untill you can answer questions like what are the true cost of insurence on each sanction for club and solo evnets? as far as I see it your still in the dark.

[Joe Harlan]

James and others the prices and facts can be found in this document:

http://www.scca.com/_FileLibrary/File/2006RateSheet.pdf

Jake, Buddy stay on the committees your on your doing good work but don't just automatically shoot a deal down cause Matt presented it. There are serious finacial issues going on and they need to be paid attention too.

I would also add that liability is likely the biggest cost of this club insurance and that liability is the same at any speed. 1 spectator or extra gets hurt at either event, It will be the liability that get charged. At this point only Road Racing is paying liability insurance and that fee is a big nut.

I see no way that they can include liability at 4.50 a car.

Let me also say it is not just about insurance and this is worth talking about. BAd choices are being made all the time and that is what continues to raise our costs as drivers. I will ask this all of you. Would you take 300k out of a safe investment making 5% and loan it to Pro racing on nothing more than a signature for 4% interest? Anyone that says yes to that my corporation wants to borrow money from. The real deal is finding qualified people to make good choices for the future of this club to run for office. There are some very good candidates right here on this board. Discussion is the only way that things will ever change. SO IT IS NOT A WASTE OF TIME IN THIS CASE.

[RSTPerformance]

What's the risk of a 23 year old with five accidents on his driving record and a DUI getting in a Viper in a public school parking lot with 200 people standing around?

This is an autocrossing club now. It's all about them not us.
[/b]

I don't see any risk in the 23 year old you mentioned above... How many autocrossers have you seen drinking at the parking lot? Your ability to get through the cones has nothing to do with your number of DUI's and the number of accidents you have had.

Now, lets look at the risk of your 23 year old at Road Racing circut??? hummm not much difference IMO...
but if you did want to throw stones, I see a much bigger risk having an accident prone, drunk driver, driving around our padock that has far more "action" than the autocross padock. Also when was the last time you saw a person in the padock at a road race drinking??? Unfortunatly from what I have sceen it is far more common than at an Autocross, not only during the day after thier "specific race" but also at the end of the day after all the races are over.

This insurance crap is absolute BS and should be stopped. Let them pay their own damn bill. Take $20 dollars off every one of our entry fees because that's about what it adds up to. And you are worng about the entry fees. Check the insurance premiums charged to the region for each sanction. $46 per driver is just insurance.

All I ask is that each department carry their own P&L and GL. Is that asking too much?
[/b]

I am not sure if that is asking to much or not and/or if something needs to done about it, simply because I like many others don't understand all of it. I do however trust those that run my region and feel that if something was ascue they would be doing the things necessary to correct them, afterall thats why I voted for them.

Unfortunatly for you, SCCA is a democracy much like our government and while we don't agree with everything the people at the top are doing, all we can do is vote for people we trust and hope that those people are in positions to fix the things that need the most important attention. Unfortunatly for us we also need to coexist with the protestors such as yourself even if we don't agree with it or don't want to be bothered by it.

Raymond "How do you feel about our own Mr. Bush?" Blethen

[JamesB]

But then it should cost me the exact same to put liability on all of my cars. But in truth the prices are different based on the potential of the car. take a NA car vs. its turbo model, there are differnent liablitiy rates.

I see what they CHARGE for each event, but what is the actual insurence cost per event charged by the binding company? I cannot see them being the same. General risk assesments alone in club you have an exponentially higher momentum that can create some dramatic crashes based off a simple spin. So untill those questions on the true cost of the binder for a club event vs. a solo event I cannot just take half the facts and treat it like an inadiqucy untill I know the true cost.

[RSTPerformance]

James and others the prices and facts can be found in this document:

http://www.scca.com/_FileLibrary/File/2006RateSheet.pdf

Discussion is the only way that things will ever change. SO IT IS NOT A WASTE OF TIME IN THIS CASE.
[/b]

Interesting document... I can say that this is the ONLY place that I have read actual fact that I trust as it comes directly from SCCA. If you have other documents you can site links to that would/could possibly also be interesting to read. This particular document doesn't mention any proof on how the rates are determined, it just states the current rates. Who determines the rates, is it the Insurance carrier or SCCA? If it is the Insurance carrier we don't have much choice, they offer what they offer. If it is SCCA distributing the cost across different events then thier HAS TO BE a process that is/was followed, does anyone now what that process is? Does anyone know our experience levels for each catagory listed?

Raymond

[Joe Harlan]

But then it should cost me the exact same to put liability on all of my cars. But in truth the prices are different based on the potential of the car. take a NA car vs. its turbo model, there are differnent liablitiy rates.

I see what they CHARGE for each event, but what is the actual insurence cost per event charged by the binding company? I cannot see them being the same. General risk assesments alone in club you have an exponentially higher momentum that can create some dramatic crashes based off a simple spin. So untill those questions on the true cost of the binder for a club event vs. a solo event I cannot just take half the facts and treat it like an inadiqucy untill I know the true cost.
[/b]

So based on the link I posted you feel Solo should have no liability cost?


Raymond, Sorry dude but local boards are getting voted in based more on popularity than actual qualification. You cannot not be sure that anyone is paying attention to these issues unless you ask... I believe the statement was "trust but verify"

Here you go Raymond from the Dec fastrac:
MOTION: That the vote to fund SCCA Pro Racing, be made in open session. (Porterfield/Sauce) PASSED, VOTING, No, Jones.
MOTION: To approve a loan to SCCA Pro Racing in the amount of $300,000, payable within two years, at a rate of 4% per year. (Jones/Gordy)
PASSED, VOTING No, Christian, Sauce, Porterfield.

[charrbq]

Chris,

Please explain how the SCCA started w/ pro racing.
[/b]

My bad, that's what I get for trying to think and type at the same time. We started as a club and continue as such. Pro Racing came along later, and that's where the club got its notariety. It was the Trans Am, the Can Am, Formula 5000, etc. that put us on the map. Sorry, I'm guilty of trying to do too many things at once.

Admittedly, factories pulled out at various times that cause problems in the respective series, but they still could be promoted better than they are now. And that would give the SCCA some of the good PR that it once held.

[shwah]

I have experience with Motosport insurance on a much smaller scale, helping to found/run a local marque club.

We run several different events that require insurance - autocross series (5-7 year), HPDE days (2-3 year), large car show (1 event). By far the most expensive is the car show, none of the cars are moving, but we have several thousand people walking around the facility all day and that represents greater risk to our insurance company. This event alone is more costly to insure than all of our driving events combined in some years. The track days are not competitve events, but are approximately the same insurance cost as the autocrosses (typical participation 30-60 drivers).

Based on that experience, I would say that the event that draws more people to the facility would be more expensive to insure. Not being an SCCA autocrosser, I don't have any feel for turnout compared to road racing.

[handfulz28]

You see, Pete Lyon is not only the club's insurance agent and insurer, but also the club's risk management specialist and general counsel[/b]

Matt, sorry I'm too lazy to try and find the detail myself, but is there some way we can confirm this as fact? Are Risk Manager and GC actual job titles/descriptions that he's earning some benefit (salary?) from? Or does he offer risk mgmt through a consultative role?
If he's an "employee" serving as GC and risk manager, that's one of the biggest examples of conflict of interest. I won't sit here and say that SCCA isn't getting the best deal, but there'd better be plenty of sealed bids to prove that's what we got. I wonder how often we shop the insurance coverage?

What if road racers were paying $10/set more for those wheels than solo drivers? It's a subsidy that has a difficult to determine value... R O I.
Obviously the club isn't going to go away, and we're not going to stop racing over $10. The point is are the best decisions being made? Without the information, only the "insiders" know...if they even know what they're looking at.