As revenue sources change, cultural institutions are pursuing a broader range of income opportunities and programming offerings — but may not always consider the risk management or liability implications.
The idea of renting a museum or a meeting room at a library for a company or community event isn’t new, but a growing number of institutions have become more willing in recent years to lease their facilities for private events that may introduce a number of different exposures.
For example, a family renting a museum gallery for a private party may not have the same event planning, risk management or safety experience a large company is likely to have access to. Similarly, someone renting a facility may want to bring in a caterer or bartenders that lack proper insurance, and the institution likely wouldn’t know unless it took steps to review the renter’s plans and the qualifications of prospective vendors.
Before leasing out their facilities, cultural institutions should work with their insurance professionals to develop policies that address common risk management, safety and liability considerations such as required insurance , certificates of insurance and policy limits, the cost of event security, alcohol management and other potential issues.
In another trend, cultural institutions are trying to increase their connection to the community, as well as their revenue, by offering a wide range of programs and services outside their traditional focus.
These may include, for instance, daycare, yoga classes, cooking instruction or other programs designed to appeal to a wider community audience that may be less interested in the institution’s cultural offerings.
If an institution is considering such a program, it’s important to also spend time thinking about potential risk management and liability concerns.
For example, a cooking class could require food-preparation permits from governmental entities — which in turn could depend on the facility having a commercial kitchen and people with appropriate food-handling training.
Similarly, a yoga class could present potential liability issues for the institution if a patron is injured while participating in the class.
It’s also important for a cultural institution to screen any volunteers supporting these activities with background checks, and to provide safety and emergency procedures training so volunteers can help prevent accidents and respond appropriately to any incidents.
As with leasing out their facility, it’s important for an institution considering public programs to meet with their agent or broker to discuss their plans and to get advice on any risk management or liability implications. Some careful planning before the institution opens its doors to outsiders or special programs can help avoid a variety of problems.
Sheila Coppinger is Assistant Vice President and Senior Risk Engineer for Chubb Risk Engineering Services.