Best's Review

AM BEST'S MONTHLY INSURANCE MAGAZINE



The Last Word
Pumpkin Launching Contests or Holes-in-One — Insurance Has Them Covered

Indemnity insurance underwrites promotional events that award large prizes, no matter how offbeat the contest is.
  • Anthony Bellano
  • July 2022

In the popular Midwestern game called “Cow Patty Bingo,” a grid of numbered squares is set up in an enclosed field. Participants buy a square, and when enough squares are sold, a cow is sent out into the field. If the cow chooses to do its business in one of the squares, the person who bought that square is declared the winner.

There's insurance for that.

It's called prize indemnity insurance, and it primarily covers promotional events in which companies award attractive and expensive prizes to winners. The insurance offsets the risk involved in paying out large prizes and covers a range of events, both traditional and offbeat.

It covers those who provide prizes awarded in promotional contests such as making a three-point shot during the halftime of a basketball game or field-goal kicking competitions held at halftime of football games. One of these covered competitions even include shooting pumpkins out of a cannon—an event known in some circles as “punkin chunkin.”

Related: All Billion-Dollar Basketball Brackets Busted in Buffett-Insured Contest

And if somebody is lucky enough to make a hole-in-one during your golf tournament—and there's a guaranteed prize for that—the indemnity insurance covers whoever doles out prizes for that, too. The mission is to help companies and businesspeople recoup the money they lose when they award prizes that they rarely—if ever—expect to dole out.

“We have a whole gaming division where we do a lot of business with casinos around the country,” said Mark Gilmartin, founder and president of Hole In One International, Hole-in-One U.S.A. and Odds On Promotions, companies that provide  insurance for such events.

Gilmartin has been in the business of providing insurance for such competitions for about 30 years. It started when he was in college and he and his friends on the golf team were thinking up business ideas. The idea came from his friend, Kirk Triplett, who went on to play professional golf and is currently on the PGA Tour Champions.

“Kirk said, 'Have you ever heard of this hole-in-one insurance? We should look into that.' I took that ball and ran with it,” Gilmartin said. “At the time, there were only a couple of companies offering it. I put together a business plan, and off we went.”

For the most part, larger insurance companies were only offering such coverage as one of their options until Gilmartin's company and a similar one, American Hole 'N One, launched around the same time. Both Gilmartin's company and American Hole 'N One are underwritten by Everest National Insurance Co., which maintains an A+ Financial Strength Rating with AM Best.

Related: Jencap Acquires Lloyd’s Coverholder Worldwide Hole ‘N One

When clubs host tournaments, they tend to offer cars, trips or other prizes if someone makes a hole-in-one on a particular hole. The hole-in-one insurance covers that, Gilmartin said.

One of Gilmartin's companies, Odds On Promotions, also provides insurance for skill-based activities, such as the half-court shot and pumpkin shooting, and conditional-based prizes where the contestant has no control over the outcome.

This includes the Cow Patty Bingo. Gilmartin's companies have a system in place to determine how to insure these events, based on odds, skill and basic mathematics.

“We don't have air guns that fit every size pumpkin, but we have enough to determine what we think are the realistic odds of somebody making it,” Gilmartin said.


Anthony Bellano is an associate editor. He can be reached at anthony.bellano@ambest.com.



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