As geopolitical tensions escalate in the Middle East, major sporting and entertainment events are
facing growing uncertainty in the region, highlighting the need for event organisers to reassess their
exposure and strengthen their contingency planning.
However, it is important to note that war is a policy exclusion, so any disruptions to an event, due to
geopolitical conflict, would likely not be covered. Whether in the Middle East or not, events that are
disrupted by conflicts that trigger international travel disruptions, flight cancellations or general
instability, would be subject to the exclusion, because insurers consider these consequential losses as
arising from war.
With reports that Formula One race organisers are considering scrapping or relocating several Middle
Eastern races this year due to heightened security concerns, the events industry is once again
confronting the reality of operating in an unpredictable world.
In addition, the conflict has led to thousands of international flights being cancelled, both to and
from the Middle East region, after several countries closed their airspace. This has had the knock-on
effect of leaving several high-profile tennis stars and cricket players stranded in the region,
potentially impacting events they are scheduled to participate in across other parts of the world.
“The current conflict in the Middle East is a stark reminder that global instability can disrupt even the
most established events. When world‑class organisers like Formula One are forced to rethink their
schedules, it highlights just how vulnerable the broader events ecosystem is to sudden change,” says
Mamoeti Nosi, Product Head: Events at iTOO Special Risks.
The global events industry has been navigating a period of sustained volatility in recent times. More
than 40 national elections worldwide, rising geopolitical tensions and shifting diplomatic
relationships have created a climate of uncertainty that affects international travel, security planning
and large‑scale gatherings.
“We are operating in a high‑conflict global environment. Political temperatures are elevated,
alliances are under scrutiny, and the ripple effects are felt across every sector, including events.
Organisers plan months or even years ahead, but the world can change dramatically in that time,”
says Nosi.
This instability is compounded by climate unpredictability, economic pressure and the lingering
aftershocks of the COVID‑19 pandemic, which brought the global events industry to a standstill and
left many businesses unable to recover.
According to Nosi, the recent cancellations and postponements across the world have reshaped how
organisers view insurance. Public disputes, such as the legal action taken by ticket‑holders following
the cancellation of the Hey Neighbour 2025 music festival, or the backlash surrounding the Cape
Town Marathon, have demonstrated the reputational and financial consequences of inadequate
protection.
“Event organisers have seen, very publicly, what happens when things go wrong. The financial losses
can be devastating, but the reputational damage can be just as severe. Insurance is no longer a ‘nice
to have’, it is a strategic necessity,” says Nosi.
Event insurance can include a range of covers, from liability and assets to contingency, cancellation
and non‑appearance. However, Nosi emphasises that organisers must understand the limitations of
their policies.
“One of the biggest misconceptions is that a general business or liability policy automatically covers
cancellation – it does not. Cancellation and contingency cover are separate, and they must be
intentionally purchased. And even then, certain perils, such as war, are standard exclusions across
the global market,” she explains, adding that the fallout from the ongoing conflict in the Middle East
would typically be covered under a political violence and terrorism policy.
Without appropriate cover, organisers face significant exposure, such as:
- Sunk costs from venue hire, staging, logistics and marketing
- Refund obligations to ticket‑holders
- Contractual liabilities to subcontractors who may still expect payment
- Mitigation costs when attempting last‑minute changes
- Long‑term reputational damage
“Many organisers assume that suppliers will be understanding if an event cannot proceed. But
contracts remain binding unless specific clauses allow otherwise. You cannot rely on goodwill when
large sums of money are involved,” says Nosi.
The insurance market itself has evolved in response to global pressures. The pandemic triggered a
hardening of the market, with higher premiums, tighter wordings and expanded exclusions. As claims increased worldwide, insurers became more cautious. - “Underwriting ebbs and flows with global realities. We collaborate with experts locally and
internationally to understand emerging risks, assess how long they may persist, and determine what
is relevant for South Africa and the broader African market,” says Nosi.
Collaboration between insurers is also essential to maintaining market stability, she adds. “Sharing
risk and sharing knowledge strengthens the entire ecosystem. No single insurer should carry
disproportionate exposure in times like these. A unified approach helps ensure sustainability.”
Ultimately, Nosi believes that the industry must adopt a mindset of resilience. “Event organisers need
to ask themselves a simple question: ‘Can I afford for my business not to recover if the worst
happens?’ In an unpredictable environment, the cost of insurance must be weighed against the cost
of losing everything,” says Nosi.
As global instability continues to shape the events landscape, Nosi urges organisers to prioritise
contingency planning, contractual clarity and appropriate insurance solutions. “It is about being
prepared. It is a matter of being safe rather than sorry,” she concludes.