Underwriting Covid Risk

What is the future for events insurance post Covid? asks Tysers’ Tim Thornhill.

Man protecting himself from COVIDThe first week of March saw the Chancellor announce further support to some businesses within the cultural sectors and a further £300m is welcome, along with the announcement of the extension of the government furlough scheme and continuation of VAT at 5%. However, there are many other businesses within the ecosystem who will not benefit as much, unless a government backed insurance scheme is in place. If there is no insurance, events are unlikely to be held and there will be huge disappointment for attendees and the industry. The earlier promoters and organisers can plan, the safer the events will be.

We want to be optimistic about the reopening of venues and restart of events, however, there must be insurance available, particularly while Covid-19 continues to have a catastrophic impact on the events industry worldwide.

Understandably, the commercial insurance market has been unable to offer cover for Covid related risks in relation to event cancellation due to the size and uncertainty of the pandemic. Currently, due to their global nature, some risks are better suited for governments to offer protection against. This is not surprising given that insurance losses in 2020 were in excess of $8bn, with more losses still to follow.

Because of these losses, event operators and attendees are finding themselves in the difficult position of being expected to re-organise and book without any protection against further lockdown possibilities.

The insurance industry too is faced with a problem – how can we help businesses mitigate risk and plan for the future as we would usually do?


As an example of how an insurer can usually step in, if your car is stolen, insurance will help you get a replacement, or if you’re setting up a new business and your premises goes up in flames, insurance will protect you. However, when it comes to Covid cover for event organisers looking to reopen their gates this year, there is market failure.

Insurers currently have no incentive to underwrite Covid risks for event organisers, and why would they? They have already incurred huge losses from events that had to cancel as a result of the pandemic. And the losses of 2020 follow those of 2019, when awful weather led to a huge number of contingency insurance claims specifically for event cancellation.

We are currently in the process of a reset of the insurance market in relation to communicable disease. As the uncertainty of the pandemic eases many within the live events sector are encouraging our government to step in to help, by temporarily underwriting the Covid risks for events when it is safe for them to go ahead and ensure the events industry can get back on its feet.

Eventually, as we have seen with terrorism insurance, we anticipate that the commercial insurance market will come back and underwrite the risks again. But, at the moment, event organisers, production companies, freelancers and all others in the supply chain are in a state of hiatus. While tickets may be purchased, money is not flowing through the supply chain as it would normally be, contracts are being renegotiated and there is stress on many areas of these businesses, both financial and emotional.

In 2020 Tysers facilitated the settlement of hundreds of millions in claims as a result of our unique non-appearance insurance policy. We continue to work with the insurance market to ensure that products are fit for the future as the uncertainty diminishes but, without doubt, there will be future challenges. We have been fortunate to have had great support from our clients and insurers whilst we navigated through this terrible period for our events industries.



Tom ThornhillTim Thornhill is a director at Tysers which arranges cover for some of the biggest events in the calendar worldwide and insures some of the most prestigious international artists. Tysers’ reputation and experience gives peace of mind and ensures you are suitably protected but should the worst happen, the in-house team will support the efficient management and satisfactory settlement of a claim.

Tysers is an established Lloyd’s broker, trading for more than 200 years and offering specialist solutions and expert advice on insurance and risk management. 0203 915 0000 / www.tysers.com

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