When Your Event Can’t Go On: The ins and outs of event cancellation insuranceRHolmes
Illness, transit strikes, faulty equipment, safety evacuations, kitchen fires, storms, blocked drains, soggy ground, gas and water leaks, volcanic eruptions grounding airlines – sometimes your event just can’t go on and you need to recover your expenses. This is the point when you’ll be glad you got event cancellation insurance…or kicking yourself if you didn’t.
At bare minimum, you’ll want to be covered for your expenses that went into the event, but what about all that revenue you were expecting to get out of it? Depending on the type of event cancellation insurance coverage you select, you can receive compensation for lost revenue if your event doesn’t go on as planned.
When it rains on your parade and you need to make up your losses, protecting profit on top — if the event is a money-making event — is optional, but certainly worth it if your business depends on the income. The basic form of this coverage is incredibly broad and is sufficient for most events. If you need to, you can also extend your policy to cover wet weather for outdoor events or if a speaker or artist is a no-show.
If you’ve begun your search, you’ll find most event insurance includes cancellation and postponement coverage. This should adequately protect you if something unexpected happens, but look carefully at the things the policy doesn’t cover before you choose. Do you want to cover your lost profits or just your expenses? These are important details that can make a huge difference in how much you can recover from your claim.
What Exactly Do You Mean By “Cancellation?”
An event doesn’t necessarily need to be canceled in advance for it to be eligible for a claim. There are a few types of occurrences event cancellation insurance can cover:
- Cancellation – Event cannot start at all
- Abandonment – Event starts but cannot finish
- Disruption – event runs but not without partial/intermittent interruption
- Postponement – Moving the event date. A typical cancellation policy should include an additional expense allowance if you are forced to postpone for reasons outside of your control. This allowance is there to cover costs associated with postponement, such as notification to customers, additional venue fees, additional staffing hours, remarketing, etc.
- Relocation – Moving the event location. As with postponement, your policy should include an additional expense allowance for things such as notifications, new venue hiring costs, additional staffing, remarketing, etc.
Despite all due diligence, bad things can happen to good event managers. You can’t stop bad luck or freak events, but you can make sure you adequately protect yourself, so your career, business and personal finances remain intact through it all.
Other Event Insurance Coverage Options
Finally, just as no one business in the event space is identical, the same applies for event cancellation insurance solutions. There may be alternative policies, such as rain insurance, that you should be considering as part of your overall risk management process. Other coverage options include:
- Cumulative rainfall coverage – This coverage provides for a claim if a specific amount of rain occurs over a specific time period
- Rain-free or dry hours – This coverage provides for a claim if a rain occurs during a specific number of hours over a designated time period
- Coverage for snow, lightning, fog, extremes in temperature, hurricanes, tornadoes, high winds and other adverse weather may be obtained. We can also combine weather elements into a single policy to, for example, cover days that are both cold and wet, or hot and windy.
- We will work with you to design a policy to meet your own unique requirements, including policies that address a lack of rain or snow.
The information in this post is of a general nature only. It does not take your specific needs or circumstances into consideration. You should look at your own situation and requirements before making any financial decisions. To discuss your specific needs regarding event cancellation insurance or other weather insurance, contact Spectrum today. We’re experts in weather and event insurance and are happy to work with you to customize an insurance plan that fits your needs and budget. Click here to get in touch.