THEY’RE ASSIGNED RISKS : Insurance for Race Drivers, Tracks Available, but It’s Costly

Driving a race car is a dangerous business. No one will argue with that. It can also be a crippling business.

Drag racer Shirley Muldowney’s top-fuel dragster went out of control at 250 m.p.h., injuring her legs so severely that she was hospitalized for three months, had five major operations and underwent outpatient therapy for more than 18 months.

Indy driver Roberto Guerrero crashed into a wall while testing tires, and the impact put him in a coma for two weeks in an Indianapolis hospital.

Stock car driver Jim Robinson is still in a San Fernando Valley hospital, in a coma, after spinning into the wall during a race at Phoenix on Feb. 7. Before he was moved from a hospital in Phoenix, he underwent a 6 1/2-hour operation to reconstruct his face.

On the same track that Richard Petty survived, without injury, the spectacular whirling dervish spin-out in the Daytona 500 that made all the TV news shows, fellow stock car driver J. D. McDuffie was burned about the hands so badly that he was hospitalized for more than a month. He is still in Daytona Beach, Fla., undergoing therapy twice a day.

Who pays for all this?

Race drivers, contrary to popular opinion, can buy insurance. Most drivers are covered, to a certain extent, by group policies bought through a sanctioning body, a major sponsor or a driver’s organization. After that, much as with Mr. Everyday Citizen, it’s up to the individual. He can buy as much coverage as he likes but the price is stiff. Very stiff.

Each insurance broker, each sanctioning body, each track seems to approach the subject a little differently, but it all equates to a major expense of racing.

For Indy car drivers, Championship Auto Racing Teams Inc., which sanctions and produces 14 races in the CART/PPG Indy Car World Series, and the Championship Drivers Assn. share in the insurance costs.

CART’s basic policy covers the first $50,000 of any accident that occurs during one of its races or activities leading up to that race. The CDA’s umbrella policy takes over after that and, according to Kirk Russell, CART director of operations, there has not been a situation in which the cost of injuries has not been fully covered.

The policy, which CART officials would only say costs in six figures, covers not only drivers, but also officials, mechanics and all team members.

Accidents such as Guerrero’s, however, would not be covered under the CART policy, since it occurred during a team tire test, and not during a race.

In Guerrero’s case, the CDA portion of the policy was in effect, since he is a member of the organization, but any other insurance would have been obtained by the individual team, Vince Granatelli Racing of Scottsdale, Ariz., or the company that rented the track, Goodyear Tire and Rubber Co.

Before each season, CART makes available to every team what type of insurance is obtainable, and recommends coverage in different situations, such as individual testing and in-transit travel, not covered by its basic policy.

Coverage for CART and the CDA and most other racing organizations, except for NASCAR, is carried by the K&K; Insurance Co. of Fort Wayne, Ind.

For stock car drivers, NASCAR requires the participating tracks in its Winston Cup and Winston West series to carry a minimum of $50,000 medical and $25,000 death in participant liability insurance for each race. There are 29 national and 9 West Coast events.

“For most accidents, that $50,000 is adequate,” said a NASCAR official who requested anonymity. “But who’s to say what’s adequate? If every track had to provide what could be a maximum liability figure, we’d be out of business.”

Premiums differ according to the size of the track. For a super speedway, such as Daytona, Talladega or Darlington, the cost is approximately $8,000 an event. For the shorter tracks, it is closer to $2,000. For insurance purposes, Riverside is considered a super speedway and pays the higher premium.

Tracks associated with NASCAR on a weekly basis, such as Ascot, Saugus, Orange Show, Bakersfield and Cajon speedways, pay a much smaller premium, with comparatively less coverage. Their prerace premiums average between $800 and $1,500, depending on the size of the track and its safety record. The coverage is $15,000 for medical costs.

“Obviously, there is a disparity between $50,000 for a Winston Cup accident and $15,000 for one at one of our weekly tracks, but there is a limit to what a small track can afford,” the NASCAR official said. “For some of them, even $1,000 a night is pretty stiff compared to their income.

“What makes our (NASCAR) tracks different is that we force them to carry a certain amount of insurance. Some tracks will carry more, on their own, but there are between 800 and 900 tracks around the country not affiliated with NASCAR and a lot of them don’t carry insurance worth the paper it’s written on.”

All NASCAR and Winston Racing Series insurance is written by the Naughton Insurance Co., Inc., of Providence, R. I., a pioneer in motor racing coverage.

Premiums for different types of racing also differ according to their danger, even on the same track.

Sprint car racing, for instance, calls for three times as high a premium as stock car racing, but its benefits are higher.

The California Racing Assn. buys its own participant insurance with a $25,000 medical benefit and a $20,000 death benefit, plus a long-term disability benefit that will pay $140 a week for two years.

The cost of the premiums, which average about $3,000 a race, are shared by the promoter and the individual CRA members, including crewmen, who pay $13 for a pit pass at a track such as Ascot. On a practice night, the fee is $11. Part of that back-gate money goes to pay for the insurance.

The CRA also is offering, for the first time this season, additional group insurance that the drivers may buy themselves.

The United States Auto Club and the World of Outlaws have similar coverage for their sprint car events. USAC midget races, because they are less dangerous than sprint cars, have a lower premium.

It has been traditional in racing that the participant helps insure himself, while the promoter, the track, or both, take care of the general liability, which protects the spectators and also protects the track and drivers against suits from outsiders.

Liability coverage can run as high as $10 million for major races at major tracks.

That type of coverage is needed to handle such claims as the $9-million suit filed against the Indianapolis Motor Speedway last month by Karen Ann Kurtenbach of Rothschild, Wis. Her husband, Lyle, was killed during last year’s race by a wheel that broke off Tony Bettenhausen’s car and flew into the grandstand.

In some long-term disabilities, such as Muldowney’s, insurance runs out and organizations such as the Drag Racing Assn. for Women--which was formed when Muldowney was hospitalized--help raise money for medical bills and rehabilitation.

“If it hadn’t been for them (DRAW) I probably would have been wiped out,” she said.

DRAW conducts charitable activities, the primary one being a barbecue and auction at the National Hot Rod Assn.’s U. S. Nationals in Indianapolis, to help families of drag racers who are laid up.

For races such as the Skoal Copper World Classic at Phoenix, in which Robinson was injured, there is no sanctioning body involved and the insurance is carried by the track, the race sponsor or both.

The coverage for Robinson’s injuries amounted to $25,000. His former wife, Ouida, was quoted in the Daily News as saying that it was used up in under three days.

Robinson apparently carried no personal insurance, so friends and associates, headed by fellow driver Ruben Garcia, have set up a fund to help with his mounting expenses. Robinson was recently moved from Phoenix to the Holy Cross Medical Center in Mission Hills.

Insurance rates for drivers, like auto insurance rates for everyone, continue to escalate, but because the number of race drivers is so small in comparison to street drivers, large payoffs scare insurance brokers. Rates are set, not by agencies such as K&K; and Naughton, but by the underwriters, such as Lloyd’s of London and Trans-America.

“When a home or car insurance company gets hit with a big judgment, it just means that the rates go up on your personal car insurance $50 or so,” said Cary Agajanian, president of Ascot Park and a practicing attorney who specializes in motor racing cases. “It doesn’t happen that way with race tracks because there aren’t enough of them to absorb the claims.”

Agajanian, whose father, J. C., was a pioneer racing figure in Southern California, is something of a legend among racing promoters because of his part in having a $10-million suit dismissed. It was filed by driver Clay Regazzoni against the Long Beach Grand Prix Assn. and Toyota Motor Sales, USA, after Regazzoni’s accident in the 1980 Long Beach Grand Prix.

Regazzoni, who won the inaugural LBGP in 1976, lost the brake pedal on his Formula One car while going approximately 160 m.p.h. toward a 180-degree, 40-m.p.h. hairpin turn. When Regazzoni could not slow down, he deliberately rammed a parked car to keep from crashing into a concrete barrier but that didn’t slow him enough and he hit the barrier anyway.

He was paralyzed from the waist down.

Regazzoni had signed waivers and releases with both the LBGP and his car owner. He testified, however, that he had no knowledge of the importance of those documents.

“The waiver and release, which every driver signs, must be recognized as an absolute, or there will be no insurance at all, and if there is no insurance there will be no racing,” said Agajanian, who defended the track in the case.

The court agreed when the suit was dismissed by Los Angeles Federal District Judge Manuel Real.

Agajanian said: “It is extremely unfortunate that anyone is ever injured in motor sports, but it is also unfortunate that a professional driver, injured by the very risk he gets paid to take, and who works all his life for the chance to participate in the fame and fortune involved in Grand Prix racing, would refute his agreement and sue the very people who make such racing possible.

“If litigation such as this is successful, it is foreseeable that race drivers might bring actions against the sanctioning bodies, course workers and officials, car owners, sponsors, constructors, mechanics, and even fellow drivers.

“Suits such as this truly threaten the very existence of motor racing. If this standard release form had been ruled invalid, organized racing events would have become uninsurable, and without insurance organized racing would not exist.”

Mario Andretti, former Indianapolis 500 winner and world driving champion, once testified during a similar trial: “We’re like test pilots. We’re testing beyond limits that are known, and as a race driver you accept that.”

The power of the insurance broker over racing promoters was never more evident than at Anaheim Stadium in January when K&K; canceled its policy on the late Mickey Thompson’s Thunder Drags three days before the event was scheduled. During a demonstration the previous Saturday, a dragster crashed and sent flying debris into the stands, injuring 19 people.

Thompson was indignant about the cancellation and immediately had his attorneys prepare a suit against K&K;, citing a 30-day non-cancellation clause he said the policy included.

“Without debating the merits of the case, the incident points out a frightening situation for promoters,” Agajanian said. “What if, on the day before the Daytona 500, Bill France was told that he had no insurance?”

It isn’t always high speed, or careening cars, that cause insurance rates to soar, or to be refused. Ascot Park recently canceled one of its popular weekly events when it couldn’t get adequate insurance.

It was bicycle motocross.