The Government has unveiled details of a scheme that will allow companies to purchase cover for enforced cancellation of live events due to changes in Covid restrictions.
This decision follows continued lobbying by the PPA, as well as industry groups including the Events Industry Alliance (EIA).
The Government has partnered with Lloyd’s on the scheme, which is worth over £750 million and will be supported by a number of insurers in the Lloyd’s market including: Arch, Beazley, Dale, Hiscox and Munich Re.
Companies running events, including B2B events, will have the option of purchasing cover from September 2021 until the end of September 2022. There will be no cap on costs claimed per event. The scheme will also run alongside companies’ standard events insurance.
If events do have to be cancelled after organisers have covered the agreed excess, the Government and insurers have an agreed a risk share per claim. This starts with Government paying 95% and insurers 5%, progressing to them covering 97% and 3% respectively and finally Government covering 100% of costs. The split depends on the losses incurred by the insurer from the scheme to date.
Although this is a positive step, the PPA will be monitoring for further details of the scheme and lobbying Government to ensure that the scheme covers the most likely causes of event cancellation. For example, it appears that the scheme does not cover reductions in capacity or cancellation due to the reintroduction of social distancing restrictions, or speakers or event staff being compelled to self-isolate (as an event would still be legally able to happen). Therefore, the scheme still leaves the live events sector exposed to a higher level of risk.
Chris Skeith, CEO of the EIA, said: “This new insurance scheme will hopefully play an important role in our ability to do that as we reopen in a safe and responsible manner.”
House of Commons Digital, Culture, Media and Sport Committee chairman Julian Knight commented: "Though it is a shame that it has come too late for some this summer, this scheme will provide the confidence the sector needs to plan and invest in future events."
The PPA will continue to monitor for further developments and publish updates on events insurance when more details become available.