Insuring Special Events

Your company has decided to plan an event, and you’ve set up your budget, selected the venue, signed the contract, and paid the deposit. You’re excited about your keynote, your entertainment and your caterer, and your invitations are in the mail to your guests. All of the enumerable moving parts of planning an event have been buttoned down, and you’ve met your deadlines. Nothing can go wrong now, right?

Not necessarily.

When you review the insurance requirements in your hotel/venue leasing agreements, you will see specific liability limits that your organization must maintain for the duration of the contract. Typically, venues require a minimum occurrence limit of $1 million and can go as high as $10 million or more depending on the type of event and facility being used.  While you may be able to fulfill these contractual insurance requirements with relative ease, it’s important to understand that your organization is still not fully protected against the risks associated with hosting an event.

General Liability Insurance for Events

As a rule of thumb, general liability insurance responds to claims related to third-party bodily injury and/or property damage, and there is exclusionary language relative to claims alleging breach of contract, warranty and/or representation. Your event venue requires that you maintain general liability for the duration of the contract, and it requests to be named an additional insured on your policy to protect its interests and further buffer the triggering of the venue’s liability policy for your negligent acts. 

Event Cancellation Policies

In cases where the venue is unable to host an event due to a fire, labor strike, weather event, or act of terrorism, the consequent financial loss incurred by the event host is not covered by a standard insurance policy. This very specific coverage is found in an “Event Cancellation Policy.”

A few years back, Hurricane Katrina left numerous businesses scrambling to relocate their respective events or having to cancel them outright. Many hotels, entertainers, keynotes, and others contracted for New Orleans events returned only a portion of the deposits or refused to return them at all. Even many of those who agreed to return full deposits took weeks to process the return payments, causing a considerable cash flow strain on businesses with limited budgets. Those businesses with event cancellation insurance had immediate access to resources provided by the insurer to secure new venues, put down deposits, and remarket the event to guests.

Event cancellation policies can also be broadened to cover acts of terrorism that are local to the venue or that occur nationally but still impact attendance to the event. There are even sub-limits that automatically apply to smaller events during the policy term (like board retreats). To lock in rates/premiums, coverage can be purchased up to 36 months in advance of the event dates.

For more information about event insurance and a no-obligation quote, contact: 

Jeff Greene, Vice President at Howard W. Phillips & Co., Inc. by email at jgreene@hwphillips.com.