- Bryan Williams
Rage Rooms: Where Property Destruction & Insurance Meet
The world is a stressful place. Sometimes it makes you want to revert back to childhood & have a tantrum - possibly breaking things in the process. What if you had a safe space to smash things & get rid of some of this stress? Whether it's for stress relief, anger management or simply group entertainment, Rage Rooms (often called Wrecking Rooms) have become a phenomenon across the United States & other countries.
Rage Rooms allow for individuals or groups of people to reserve a room for a set amount of time & break an assortment of items. People can break everything ranging from computer monitors, TVs, CARS!, plates, bowls, your exes' gift that he bought for you, etc. They break these items with their "breaking tools" - which can look something like a shovel, sledgehammer, golf club or baseball bat.
As you can imagine, the insurance world is a bit perplexed when it comes to insuring this type of facility. Escape Rooms, Family Entertainment Centers & similar types of experiences have many insurance programs out there. Unfortunately, that is not the case with Rage Rooms and most insurance brokers & carriers are unfamiliar with the risks associated with Rage Rooms.
SBW Insurance Services has been insuring Rage/ Wrecking Rooms for over 7 Years. In fact, the owner of SBW Insurance Services helped develop one of the first Rage Room Insurance programs in the country when he was a Broker at Hayes Brokers. You can still find one of the archived blogs if you search hard enough...
The most important coverages for Rage Rooms are listed below along w/ some common pitfalls associated with many other insurance policies.
General Liability Insurance - Considered to be the Basic Type of Insurance Coverage needed for any business. This will cover third party bodily injury & property damage, including bodily injury to the participants of the Rage Room. Pay close attention to make sure there is not an exclusion for "Athletic or Sports Participants". Many times, this type of exclusion can render this policy useless as it would not cover any bodily injury to a "Participant" that is actively destroying property in the Rage Room.
Tenants Improvements & Betterments (TIB) - Rage Rooms invest heavily to convert their rented space into a usable Wrecking/ Rage Room. This often means investing anywhere from $25k - $100k to create separate rooms with plywood & soundproofing the rooms, adding a Sign to the Building & making a storefront, decorations, etc. Basically, anything that is an improvement to the building that the tenant installs/ pays for is included as a TIB. This is not going to be covered by the Lessor's Master Property Policy since they do not own the Improvements or Betterments & if the entire complex goes up in flames you're out of luck. Business Personal Property is not the same & will not cover your Improvements to the Building.
Workers Compensation - If you have employees, you are required to have Workers Comp Insurance. Depending on the state in which you live, 1099 (Independent Contractors) are still considered to be employees of the organization unless they qualify as an Independent Contractor (the fact that you pay them as a 1099 contractor has very little sway over the Workers Comp Laws in these states).
Commercial Auto - If you use a vehicle for your business, commercial auto is a necessity of your Risk Management Plan. This includes any trips to pick up the items from Goodwill, the junkyard, etc. that will be destroyed in the rooms. SBW Insurance Services can also insure MOBILE WRECKING ROOMS. These are Rage Rooms that bring the destruction to YOU! If you only have personal auto insurance, please make sure that it will cover the business trips to / from the junkyard, Goodwill, etc to pick up the breakable items. Also, if you have a Mobile Breaking Room, please make sure that your auto policy doesn't exclude liability coverage for when people step foot inside of the vehicle - many commercial policies exclude this.
Lastly, please make sure to read the Contract with your Landlord carefully. Make sure that you are not being held responsible for maintaining the premises and sidewalk/ parking lot. Make sure that you are not being held responsible for any Plate Glass Coverage or Building Coverage that you don't have an insurable interest in (ie you're not responsible for any damage to the building that isn't caused by your actions - an exception to this is the Tenant Improvements coverage that may be needed). You should have your insurance broker and lawyer review your contract to make sure that you're protected.
Reach out to SBW Insurance Services today at 925-588-6404 if you're looking to shop your Rage Room Insurance Policy at renewal or looking to start your very own Rage Room.