It might seem that pricey Event Cancellation premiums just aren’t worth it, but how much could you stand to lose if your event was cancelled?
Event cancellations and postponements happen all the time. Whether it’s a stadium gig or a garden party, sometimes it’s just unavoidable. Big names fall ill and have to cancel, the weather causes unexpected problems or there’s a problem at your venue.
If an event is cancelled or postponed last minute, chances are you will have already spent money setting up your event. This is money you won’t be able to get back. As you won’t make the expected revenue from the event (your customers are legally entitled to a refund if you cancel or reschedule) then you’ll be left paying irrecoverable costs. That’s where Event Cancellation Insurance comes in handy.
Why are cancellations increasing?
Adverse weather claims are on the rise. There’s no definitive reason for this, but globally there have been a number of prolific weather incidents over the past few years. Recent flash floods in the UK, for example, caused event cancellations across the nation. If these incidents rise over the next few years, we can expect to see the number of claims rise too.
The number of performers cancelling an event last-minute is rising, too. Some experts are concerned about the rising age of some prolific celebrities, with illness much more likely among older performers. For smaller scale events, musicians and performers are more likely to cancel if their travel is disrupted or they fall ill. You may have a cancellation clause in place in their contract but, even if the performer in question pays for promotion or venue costs, you’ll still be left footing a fairly hefty bill.
You should also be aware of reasons for cancellation that won’t be covered by your insurance. This includes poor ticket sales or missing paperwork (such as not having the correct alcohol license). To avoid cancellation, make sure you’ve done everything you can to organise your event efficiently – including marketing your event to increase ticket sales.
What is Event Cancellation Insurance?
Event Cancellation Insurance will cover you for any irrecoverable costs associated with your event should you have to cancel. You can also purchase additional extended cover for adverse weather, non-appearance of an individual and loss of revenue. All of these options cover you for various cancellation scenarios.
Why is Event Cancellation Insurance important?
When something goes wrong, suddenly your bank balance becomes one of the most important things to worry about. Event cancellation doesn’t cancel out costs or contracts. You’ll potentially still need to pay suppliers, performers, venues, staff and much more.
Why are Event Cancellation Insurance premiums rising?
Artist and performance fees are rising, making events such as festivals or music gigs costly cancellations. While there may not necessarily be an increase in the number of events being cancelled each year, there is an increase in the size of cancellation claims being made. It’s thought this is to do with rising costs across the board, from pricey production costs and higher fee demands.
We’ve spoken previously about the importance of experiences. People expect more than seeing a band playing their hits – people want a performance with production value. Consumers want an overall experience that can’t be replicated, and event professionals in every sector are taking note. Events are becoming “bigger and better” in order to stand out from the sea of competition – and this comes at a price.
This means that claims are getting more costly too. From an insurance viewpoint, pay outs are ultimately paid for by the premiums customers pay to insure their event. As claim costs rise, so do premiums. Experts estimate that Event Cancellation Insurance premiums have increase by up to 30% in the past 12 months – and this trend shows no sign of slowing down.
What is the impact on the insurance industry?
Some insurers have decided not to offer cancellation insurance. As the market shrinks, it becomes more difficult for event organisers to find adequate insurance. That’s why insurance brokers like Insure Our Event offer a great way to ensure you have the right cover in place for your event.
High premiums should not be an excuse for not arranging adequate insurance. It’s easy to think the worst won’t happen but, if it does and you aren’t insured, you could be left with a large financial burden for a cancellation.
At Insure Our Event, we’ll make sure you have the best cover for your event at the right price. For a no-obligation quote, get in touch!