How helpful will the Government’s event cancellation reinsurance support scheme be?
The return of live events is an encouraging sign that things are returning to normal after 18 months of COVID-19 restrictions. With gigs and festivals opening up again, event promoters are enjoying welcome new revenue.
But the ongoing situation around COVID-19 is still unclear. The threat of fresh restrictions or new local lockdowns is real. The potential impact of these could be huge, especially on an events sector that’s only just finding its feet again. In this context, the UK Government's recent announcement of its event cancellation reinsurance support scheme is great news for the industry.
A fresh guarantee for events promoters
Through it, the Government promises to cover any costs incurred if promoters cancel an event because it is legally unable to happen due to COVID-19 restrictions. The scheme represents at least £750 million worth of potential support for the events industry.
Here's how it works:
- Events companies can purchase cover from September onwards.
- There’s no limit on costs that promoters can claim per event.
- The event company covers an agreed portion of any losses.
- This excess is then deducted from the claim, while the Government and insurers cover the remaining costs between them (95% and 5% of the costs, respectively) under an agreed risk share arrangement.
The scheme is good news for insurers too, whose exposure is capped, while the scheme allows for the Government's share of the payment to rise to 100%.
Is the new scheme helpful?
Up to now, many insurers have been unwilling to provide cover for COVID-19-related cancellations, so yes. But the new scheme also comes on the back of a summer of cancelled events. For many promoters, it is too little too late.
There are also reservations that it doesn't go far enough: that it doesn’t cover any lost income due to councils imposing local social distancing rules, or if an artist or a member of their crew gets COVID-19 and a tour is cancelled.
A sector that’s worth £70bn annually to the UK and supports more than 700,000 jobs is right to have expected help sooner. But it is also our belief that the new scheme is now a real lifeline for those who have survived this far.
To find out more and to discuss your needs, please contact us on 01274 515 747 or email us at email@example.com