If someone gets hurt at your event, you have to cancel last-minute or your kit gets damaged, what would that mean for your business?

When things go wrong, insurance is there to cover you, meaning you don’t have to worry about unexpected bills and can keep on running. It’s like having an umbrella on you when the weather suddenly turns from clear skies to thundering rain.

Hiscox Event Assured has been providing event insurance solutions for event organisers for over 30 years.

Martin Linfield, Head of Event Insurance, explains why adequate cover is essential for anyone organising an event, and shares his advice for getting the most from your policy.

Related: How to write an event business plan

What type of insurance does an event planner need?

“Pretty much every single event should have some kind of insurance; any event where there are attendees has some kind of exposure. The most basic forms are public liability and employers’ liability.

• Public liability can protect you from a claim if someone is injured at your event. Normally the event organiser will be required to submit a public liability insurance certificate to the venue where the event is taking place because it’s unlikely the venue will want to cover any claims through their insurance caused by the organiser’s negligence.
• Employers’ liability can cover claims if an employee or volunteer is injured. Employers’ liability is a legal requirement for most companies hiring staff in the UK.

“Public liability is the first building block of any event insurance portfolio, which can include up to eight different products.”

How much does it cost for event insurance?

“It will be a mixture of the type of event, the number of people attending, how long the event is and where it’s taking place. Are there any hazardous activities? The further up the scale of hazardous, the higher the price is likely to be.”

What type of activity is deemed hazardous?

“Every insurer will be different, but generally it’s if there are any at height activities or at speed activities or any activities going on in the water.”

What is event cancellation insurance?

“Cancellation insurance is the other main building block – it’s also called ‘cancellation and abandonment insurance’ or ‘contingency insurance.’ This is protection of the event organiser’s budget, including the expenses and possibly some profit, which added together is the revenue. Any event organiser who is financially at risk if the event does not take place or is postponed or curtailed should consider buying this type of cover.

“The need to cancel an event can occur through freak weather or the venue not being available on the day. In that situation, the venue will only refund the venue fee; they’re not going to pay for all the organiser’s other costs. This insurance is an indemnity policy and puts them back in the same position had it not have happened.

What other types of insurance are available for event organisers?

“Another type of insurance that many event organisers take out is property insurance, which covers any equipment they bring in, such as AV. Events are getting more sophisticated and organisers are bringing in increasing amounts of kit – like we saw at the Super Bowl recently! It would have cost a lot of money to bring that property in and the organisers would have cover for that.”

Related: How to apply for a temporary event notice (TEN)

What are the more unusual types of cover?

“If the event organisers are going to some interesting places in the world they might want a kidnap and ransom policy. Then we’ve got cyber risks where websites are being hacked into and people are fraudulently stealing money off event organisers through phishing emails, so we can provide cover for that.

“Another example is event organisers perhaps needing professional indemnity insurance. The reality is that the service provided can be challenged and vulnerable to a claim of negligence when the advice or service fails to meet clients’ expectations.”

What kind of protection do you get with liability and cancellation insurance?

“It’s for things beyond your control; it’s for the unexpected. Some of the biggest claims we’ve paid in the last few years have been related to ash clouds. This has been where events have had to be canceled or have been significantly affected because people have not been able to fly into the events.

“We’ve had a murder in a venue where the venue had to be shut. We’ve had industrial action in Europe and the UK with trains going on strike. We’ve had the Uber taxi strikes which have affected events with speakers unable to get into the venues. It’s all those kind of things – the things you don’t think about.

“Most event organisers are brilliant at risk, and managing their way through a crisis, but once in a while something happens where nobody can do anything about it. For example, when the ash cloud came down on Bali during a big conference, the delegates couldn’t fly out and the key speakers couldn’t get in. It was ‘an act of God’ that no one could have predicted.” 

What are the most common claims that you deal with?

“On the liability side, we get fairly frequent claims for allegations against event organisers that they’ve been negligent because somebody has hurt themselves and then there’s a claim for compensation from the event organiser.

“We also have frequent claims for property being lost or damaged at events, either by the weather or going missing after events.”

How do you evaluate the right level of cover so event organisers know they’re properly protected?

“We regularly review our claims experience to see if there are any gaps and try to make sure our policies meet the needs of the customers. We go through any scenarios where we’ve not been able to pay a claim to see if there’s anything we can do to make sure it does cover people where it possibly can.

“Every policy has terms, conditions and exclusions and we always encourage everyone to read the summary of cover. It’s just one or two pages setting out the main areas of cover and significant exclusions.”

What are the usual exclusions?

“With cancellation policies, one of the main exclusions is terrorism, but we automatically offer a quote for terrorism cover depending on the details provided to us – it’s what’s called an ‘extension of cover’.

“The other main exclusions are a lack of interest in the event or lack of ticket sales. If you’re no longer able to finance the event, that also tends to be excluded.

“It’s very important to fully understand any exclusions. Our policy is worded in plain English and is specifically aimed at event organisers and exhibitors to make this as simple as possible. I’d always recommend dealing with an event insurance expert and buying a policy specifically designed for events, not just a general insurance policy.”

Where do people go wrong with their event insurance?

“Not buying their event insurance early enough. They should do it as early as possible because the period of their insurance is from the day they buy it to the end of the agreed cover period. As soon as they have spent some money, maybe securing the venue – even if the event is 12 months away – they have something there that is potentially non-recoverable.

“I see a lot of event organisers leave purchase until there is a major problem going on in the world. We’ve had a real increase in enquiries for terrorism cover for events in Paris and now the price has gone up because it’s more risky. Those who bought the cover before the Paris attacks would have got wider cover at a more competitive price.

“To give another example, if Eurostar announced strikes for the next eight weeks, people whose events are dependent on getting across on Eurostar would find it more difficult to buy an event cancellation policy to cover them for that particular problem. Whereas at the moment there is no exclusion for Eurostar strikes because there are none planned

“One of the other benefits of buying cancellation insurance early is the ‘additional expenses cover’ – this is any problem with the event before the event date. If the reason for the problem – what we call the ‘proximate cause’- is covered, a good insurer can help with additional expenses to keep the event going.

“Say there’s a problem with the venue two months before the event, the insurer is going to help pay for the additional cost of moving the event to a new venue. That keeps the event going and the cost is likely to be less than if the event was off.

“If an event organiser only buys their insurance a week before the event, then they’re not getting the full benefit of the policy, so the biggest piece of advice I can offer is buy early!”

Conclusion

Make sure you’re properly covered! No matter how well organised your event is, there are always eventualities that can’t be planned for, and insurance can protect you against the unforeseen.

Public and employee liability insurance is the minimum you may want to consider for any type of event, but cancellation, and extended cover for contingency, property or terrorism could prove a valuable investment.

Related: A simple guide to premises licence rules for events