Few would disagree that we are living through increasingly challenging times! Apart from extreme weather conditions, the continuous threat of terrorism, political unrest in many countries and scientific warnings of another volcanic eruption in Iceland, we also have Ebola and the fear of its spread to consider. What next?
The impact upon the events industry due to forces beyond its control can potentially be immense for both event organisers and suppliers in the absence of adequate insurance protection.
It always a surprise me, the number of event organisers that either do not insure or insure inadequately against cancellation risks or do so but not in good time.
I have no doubt that many of my peers in the events industry are tired of hearing me constantly stress the importance of effecting cancellation cover as soon as the venue contract is agreed and signed. However, I know that one of our major clients, involved in the mining industry in South Africa, are grateful for my recent nagging! They were persuaded to effect cancellation cover for their total budgeted revenue against the risks of Ebola and other Communicable Diseases just a few days prior to underwriters declaring Ebola to be a pre-existing circumstance and therefore deemed to be a policy exclusion. This currently applies in respect of any future events taking place in the African continent, although in some instances, it may be possible to obtain cover, but subject to an expensive additional premium.
To insure early does not cost more, but it could prove costly to delay should a pre-existing circumstance arise prior to cover being operative which then becomes an excluded peril. Many years ago at the outbreak of SARS, another client of mine dithered for too long and missed securing cover by just 24 hours. Suffice to say, this is not an enviable position for either the broker or client!
It appears that scientists are expecting another major volcanic eruption in Iceland although it is difficult to estimate when. We all recall the havoc caused to air flights by the ash cloud in 2010 and the many insurance claims paid for additional costs incurred to re-route people to their intended destination. It is true that the airline industry is better placed to deal with a repeat incident, but it is a brave organiser, especially one who is responsible for overseas delegates and exhibitors, that is prepared to risk not insuring. DO YOU FEEL LUCKY?
This article was brought to you by Terry Waller from ARC International Event Insurance