Event insurance goes mainstream in India

As the pandemic-imposed social isolation comes to an end and business and life go back to normal, physical events are coming back. There are a variety of events that call for insurance coverage such as weddings, concerts, corporate events, political rallies, sporting events, movie premieres, award shows, religious gatherings, and many more. This is opening up a new insurance market and insurers are willing to offer comprehensive event insurances now, as opposed to the past when it was an uncommon coverage and underwriters were overly careful about the terms and cost.

What is event insurance and what does it cover? 

Event insurances are of different types and are offered under several names by different insurers based on their specialisation. These range from festival insurance, private event insurance, music and live events insurance, special event insurance, wedding insurance, small event insurance, one-day event insurance, and more.

Event insurance protects event organisers from unforeseen circumstances that may lead to business losses because of:

o   Unseasonal rains

o   Nonperformance of artists

o   Terrorism acts or threats

o   Mourning in the country or state where the event is scheduled

The primary cover is against any legal liabilities placed on the event organisers due to the aforementioned scenarios. In addition, the installed sets, props, clothing, and equipment are covered. 

The majority of event insurances are short-term contracts that begin when the first batch of materials arrive at the event site and end when they have been disassembled and dispatched. A few insurers also specialise in annual event covers for event management companies, media houses, film distributors, exhibition companies, and more. While there is a ready market, the majority of the coverage would have reinsurance backing to provide adequate assurance in the case of significant events with big costs.

Two recent big events were covered by event insurance. The 2020 Wimbledon Championships event was covered for COVID-19 cancellation losses and FIFA secured insurance for the Qatar 2022 World Cup in 2019. According to FIFA financial statements, “the maximum insurance volume was $900 million, which covers FIFA’s additional costs in case of cancellation, postponement and/or relocation of the event. The risks covered include natural disasters, accidents, turmoil, war, acts of terrorism, and communicable diseases.”

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