Event Cancellation: A major effect on the global sporting calendar
The world is a crazy place right now. Markets have plummeted, currencies are fluctuating, oil prices are in a downward spiral and many of our favourite sporting events are being postponed, rescheduled or cancelled altogether.
There have been recent postponements of several large global sporting events including the HSBC Hong Kong and the Singapore Rugby Sevens events, the 2020 F1 Championship Season, as well as the greatest sporting show of them all, the Olympic Games.
It is a challenging world for business in this environment of continuous economic fluctuation, where turbulence, chaos, risk and uncertainty, may be the “new normality”.
The Coronavirus (COVID-19) is playing havoc with the international sporting calendar.
The Olympic Games today is so much bigger than any other event and postponing it will still result in losses and costs running into the billions of dollars.
Years of planning have gone into Tokyo Olympics 2020. The official budget for the Games is $12.6 billion, of which $6.7 billion is “venue-related” and $5.8 billion is “service-related.” Some estimates put the actual cost north of $25 billion, and much of the spending has already been incurred, as construction is already completed.
The casualty list of cancelled sporting events globally continues to rise.
These types of decisions are always taken in the light of the health and safety of the players, fans and everyone working on the event and more recently events are forced to cancel because of decisions by governments reacting to Covid-19. Cancellation of these events is likely to result in promoters, sponsors, and local businesses losing tens of millions of dollars in projected revenue and profits.
The cancellation of these events will be devastating for businesses and suppliers as they may not be able to recoup the losses from the cancelled event.
So what’s to be done if you are an event organiser or owner of a major sporting event?
iTOO’s event contingency insurance can provide a tailored a solution to not only cover your bottom line, but also your expenses against a range of eventualities.
If an event is cancelled for any reason outside of the control of the business, the insurance policy will pay for the lost revenue and costs.
Event Cancellation insurance is purchased for events as a protection against loss of revenue or extra expenses that result from uncontrollable circumstances and reasons beyond the control of the organiser, and that result in the cancellation, abandonment, postponement, interruption or relocation of an event.
Cancellation in the case of adverse weather used to be a difficult and sometimes irregular science in the art of underwriting. However, insurers around the world have designed innovative insurance policies to protect event organizers and businesses from weather related revenue shortfalls and extra expenses. The examples of loss events under cancellation would include fire, flood, power failure, severe adverse weather and earthquake. Special covers such as non-appearance and national mourning can be included.
Communicable disease cover is usually an extension that can be covered under event cancellation, but unfortunately, no insurance companies will provide event cancellation cover as a result of Covid-19 right now. A crisis like we are currently facing has certainly raised awareness of what can go wrong when planning an event. At iTOO we have a team of experts who understand the different risks facing events and we offer expert cover adapted to each event whether a once-off or for a number of events covered under an annual policy.