You’ve found the perfect location, equipment, and employees to start your CrossFit gym. You can already envision it full of clients reaching their full fitness potential. But before you get too far ahead of yourself, there is an important logistic to consider: insurance.
We get it. Nobody really wants to pay for insurance, especially when injuries and lawsuits may never happen in your gym. But the reality is that they very well could, leaving you with massive bills and a tarnished reputation.
That’s why CrossFit gym insurance isn’t just a nice thing to have; it’s critical to your gym’s success.
The Rise of CrossFit Gyms
CrossFit as a sport began in 2000, and when the first CrossFit games occurred in 2007, there were already 70 athletes competing. Since then, the CrossFit community has exploded and become a worldwide movement.
Today, there are over 14,000 CrossFit locations around the globe serving more than 5 million athletes. As more Affiliates open, there’s an increasing need for insurance policies to ensure the well-being of the entire community.
Types of Risks in a CrossFit Gym
Physical Risks
One of the most significant risks in a CrossFit gym is, of course, physical injury. It’s essentially a given with high-intensity workouts, even if you take the appropriate precautions, like educating your clients on safe body movement practices. For instance, a client could try to challenge themselves with weights much heavier than they can handle, or a piece of equipment could malfunction and injure someone.
That’s why it’s absolutely essential you regularly check the equipment, replace any older components, educate clients on safe handling and self-care, and have each member complete and sign a waiver. But even still, those things just lower the risks—they don’t eliminate them.
And there’s also the physical risk to contractors and employees that you have to consider. Even though they have professional credentials, they are still at risk for injuries and accidents.
Legal Risks
If a client or employee gets injured at your box, they can file a lawsuit against your CrossFit gym. You might be held financially accountable for any injuries and lost wages if found liable or out of compliance with a state law.
Legal issues can also result from noncompliance with CrossFit’s terms and conditions, which include, but is not limited to, holding a valid license and paying ongoing fees. If an affiliate is found to be non-compliant, they may have to undergo a rebranding or even face operation cessation.
Other legal risks include lawsuits from clients, contractors, and employees. They could file a gym negligence case or sue for harassment, both of which can put your gym in a difficult financial position.
Financial Risks
Facing any type of lawsuit can leave you with massive bills. Maybe a client is asking to be compensated for medical bills, or an employee is requesting coverage for lost wages. Either way, those things quickly add up.
And that doesn’t even include the financial implications of replacing or repairing equipment. Every box faces the risk of equipment theft and damage. With the vast number of people using your gym daily, the equipment can easily get stolen or damaged without employees immediately noticing.
The cost of replacing equipment can be quite high, not to mention the additional costs that arise if damaged equipment malfunctions and injures someone. The Affiliate is then left to cover those hefty costs, which can significantly lower profits.
Reputational Risks
CrossFit Affiliates depend on and build a community. But one lawsuit—or even a rumor of negligence—can put your community at risk. Legal action can tarnish not only your gym’s reputation but also that of the entire CrossFit brand.
Of course, a bad rep can have lasting impacts on membership numbers and overall gym profitability. Being ill-prepared to handle a lawsuit can result in irreparable damage to your gym’s reputation.
Types of Insurance You Need for a CrossFit Gym
- General Liability Insurance: Perhaps the most essential type of insurance you need is general liability insurance, which protects your business in the event of a lawsuit from a third party. It can include abuse and molestation, property damage, and personal injury coverage.
- Professional Liability Insurance: This type of insurance provides coverage for claims against faulty training or advice. It can also help pay for medical expenses and additional legal costs during a lawsuit.
- Property Insurance: Equipment can be quite costly. Property insurance helps protect your business’s physical assets by covering damage, loss, or theft of the contents of a gym space.
- Workers’ Compensation: Remember, clients aren’t the only ones who are at risk of injury. Employees and contractors regularly guide members through intensive workouts—and demonstrate various movements. Additionally, most states mandate that Workers’ Compensation coverage must be provided for employees. That’s why each Affiliate needs comprehensive workers’ compensation insurance that covers medical bills and potential lost wages.
- Business Interruption Insurance: If you experience a property loss that affects your ability to operate at your regular full capacity. Business interruption insurance can help cover the lost revenue, rent payments, and employee wages as long as the reason for the closure qualifies as a covered loss.
Calculating the Cost of Insurance vs. The Risks
When looking for an insurance plan, many Affiliates opt for the cheapest plan—or what seems to be the cheapest plan right now. They might not think that a comprehensive plan is really worth the cost, especially with the extensive precautions they have in place to prevent injuries and lawsuits.
However, there’s always a significant risk of something happening in a gym, especially one as hard-core as a CrossFit box. And if you’re not fully prepared, your gym could take a significant financial hit, one it may not be able to recover from.
The amount of money you may save by purchasing a restrictive policy will pale in comparison to a claim or lawsuit that is denied. Just think about the costs you could be facing: thousands of dollars in medical fees, tens of thousands in legal fees, and hundreds of thousands in rented property damage. The final cost of a lawsuit could easily reach over $500,000, if not millions.
Compare that to the cost of CrossFit insurance. With CrossFit RRG, a comprehensive liability insurance policy costs less than $1,185 annually for gyms earning under $125,000 annually. It covers up to $3 million in general liability coverage and includes additional insurance types.
So, is an annual payment of less than $1,185 worth saving millions in a Liability lawsuit? We sure think so.
Common Myths About Gym Insurance
Gym insurance is too expensive.
A lot of gym insurance plans are expensive—but that doesn’t mean they have to be. One of the many perks of being a CrossFit Affiliate or Trainer is being a part of a community. And as a community, we support one another, even with affordable insurance policies.
CrossFit RRG liability policy premiums start at just $1,185 per year—less than a lot of home insurance policies. You also pay a one-time $1,000 membership contribution, which means you purchase a share of stock in the company. You’re no longer just another insurance client but a partner who has a say in the members of the CrossFit RRG Board of Directors who make decisions on behalf of the company and as a member your claims are also directed by the CrossFit, LLC legal team.
Small gyms don’t need insurance.
It isn’t the size that determines whether you need insurance. All CrossFit gyms face the same risks and liabilities, regardless of size. In fact, small gyms arguably need insurance more than larger gyms because the financial and reputational cost of one lawsuit could put them out of business.
No plan will cover off-premises CrossFit activities.
No regular plan will cover off-premises CrossFit activities. In fact, most only cover activities that occur within the rented or owned facility.
CrossFit RRG understands that a lot of CrossFit training occurs outside the box, which is why we offer plans that do cover off-premises activities.
CrossFit Trainers don’t qualify for the same insurance.
Whether you’re a licensed CrossFit Affiliate or a CrossFit Level 1 or higher Trainer, you qualify for a comprehensive insurance plan with CrossFit RRG. Trainers need insurance just as much as Affiliates, so we make sure everyone has complete coverage.
How to Choose the Right CrossFit Gym Insurance Policy
There are many gym insurance policies available, but few actually cover everything that a CrossFit gym offers, from off-premises workouts and special activities to childcare spaces. So, look for a CrossFit insurance provider that offers coverage for everything you need, both now and in the future.
Here are a few questions to consider:
- Is this the most comprehensive plan for my CrossFit gym?
- Does it offer basic coverage or go above and beyond to make sure my business is protected?
- Does it have a dedicated legal team to help if a lawsuit arises?
- Does the insurance provider offer scalable plans that adjust with my gym as it grows?
- Does the plan work with my budget?
- Does the insurance provider truly care about my CrossFit gym, or is it just interested in making a profit?
Summary
Operating any type of fitness center without proper insurance is incredibly risky.
And even though a comprehensive insurance plan does come at a cost, that cost doesn’t even remotely compare to the legal fees and medical fees you could face without insurance.
So, take some time to explore your options. Look for an insurance provider that truly cares about your CrossFit gym and offers the most comprehensive policies available to provide you, your clients, and your employees with peace of mind.