Marine cover a safe bet

When it comes to riverboat gambling, Harrah's Entertainment Inc. plays it safe by buying marine insurance.

Zurich Financial Services Group provides the gaming and entertainment company with marine insurance that covers hulls, gaming equipment and casualty risks relating to its five riverboats in Illinois, Iowa, Indiana and Louisiana, said Angela Miller, insurance services manager for Harrah's.

The hull insurance for Harrah's riverboats is distinct from coverage arrangements for its permanently moored barges that house casinos such as those Harrah's owns in Tunica, Miss.

The barges are insured under Harrah's property program, in which more than 40 underwriting entities participate. Those insurers include Schaumburg, Ill.-based Zurich; Boston-based Lexington Insurance Co., a unit of American International Group Inc.; and Philadelphia-based ACE USA, a division of ACE Ltd.

Harrah's large, self-insured retention applies to its riverboats and its barges.

Riverboats require distinct marine coverage because—even though they are moored most of the time—they may move occasionally for, say Coast Guard inspections, said John J. Bullock, president of Willis of Mississippi Inc. in Pascagoula, Miss.

Reinsurance treaties, therefore, prohibit the riverboats' inclusion under Harrah's property program, added Mr. Bullock, who places Harrah's property and marine coverages.

Zurich also writes protection and indemnity insurance for Harrah's riverboat crews, Mr. Bullock said. The P&I policy includes marine employers liability under the Jones Act as well as state workers compensation coverage for crew injuries.

This arrangement protects Harrah's regardless of which jurisdiction applies, Mr. Bullock said. That coverage structure is necessary because court opinions continually shift between whether employers are responsible for boat workers under a state act or under the Jones Act, a federal marine liability law.