Event insurance is a broad concept. Ingrid Hendrikx: ‘Organisers can choose what risks they want to cover. The most typical policy is cancellation insurance, which pays out if an event unexpectedly can’t go ahead. Bad weather is a classic example, but strikes, terrorist threats, the death of a head of state or cancellation by the artist can also be covered, for example.’
However, not all risks can necessarily be covered. ‘For example, insurers have become stricter on terrorism. Often, only an actual attack is covered, not just the threat.’
In addition to cancellation, other forms of insurance can make sense when an event is being organised. ‘Civil liability insurance is just as important,’ emphasises Ingrid. ‘If a temporary structure collapses or a festival-goer is injured by a poorly constructed stage, the organiser can be held liable.’
Separate cover for damage to equipment – whether hired or owned by the organiser – may be relevant too. ‘Lighting and sound systems or tents that get damaged are examples. Organisers can also protect their income by taking out cover for sponsorship money and even loss of profit, although that obviously affects the premium.’
One question that’s often asked is how much such insurance costs, but there’s no simple answer to that. ‘The premium is determined on the basis of numerous factors,’ says Ingrid. ‘The type of event, the venue, the time of year and the severity of the risk all play a role. A festival in the middle of summer at a well-equipped location will be costed differently from an outdoor winter event in a flood zone.’
‘For large events, it’s advisable to think about cancellation insurance well in advance. For example, if the threat of terrorism rises and you don’t yet have insurance, the cost will go up.’
Unlike some other types of business insurance, most event insurance isn’t mandatory. ‘We’re seeing more and more organisers considering it, though,’ Ingrid notes. She points to some differences in the market. ‘For example, large organisers take out cancellation insurance for some events, but not for others. They decide whether or not to bear the risk themselves based on factors such as their financial resources as a large organiser or contractual obligations. These same considerations often lead smaller or one-off organisers to arrange the cover.’
In some cases, sponsors or venues contractually oblige organisers to take out cancellation insurance. ‘This is becoming increasingly common,’ says Ingrid. ‘Venues don’t want to foot the bill if an event is unexpectedly cancelled.’
Ingrid Hendrikx points out that the event insurance market is a niche. ‘Only a handful of insurers cover these specific risks. However, that doesn’t mean you don’t have any options as an organiser. We can look at what solutions are possible for any event.’
Contact us for advice or an individual quotation at events@vanbreda.be.
