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Event Insurance

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    EVENT Insurance

    Event Insurance - Coverage, Exclusion, Importance

    Events such as Corporate conferences, get-togethers, seminars, concerts, award ceremonies, annual functions, birthday functions, marriage functions, destination weddings, sports events, etc., are a part of life and involve financial and personal interests at stake if the outcome is not as planned. One would spend a lot on these events, and abrupt cancellation could lead to financial loss and loss of peace of mind. Readmore..

    Event cancellation could be due to many perils that are beyond the insured's control and are to be covered under the event insurance policy. The sum insured is capped on a liability basis in which all the non-recoverable expenses incurred to cover the event would be reimbursed to the insured. In addition, all the revenues related to the event, such as reimbursement of tickets, loss of sponsorship, etc., would be covered on an agreed basis.

    The primary issue in case of events is a cancellation due to specific perils such as:

    • Fire and allied perils occurred at the venue of the event.
    • Earthquake, resulting in event cancellation.
    • Lightening
    • Explosion/ implosion at the event.
    • Aircraft damage to the property leading to event cancellation.
    • Impact damage to the insured property resulting in cancellation of the event.
    • Subsidence, Landslide and Rockslide.
    • Bursting and overflow of overhead apparatus, water tanks and pipes.
    • Missile testing operations.
    • Leakage from sprinkler installations resulting in cancellation of the insured events.
    • Bushfire excluding forest fire.
    • Burglary or theft at the event resulting in cancellation.
    • Inexplicably sudden, unannounced inability of the person named attending the event, resulting in the cancellation of the event as a result to any one of the circumstances such as death of the named person, permanent or temporary injuries to a person that make the person named as the victim not being able to taking part in the event, or an illness that results in the hospitalization of the person named.

    Events require a property that has to be safeguarded against perils. Damage to these could lead to the cancellation of events as well. In any case, the insurer's maximum liability would not exceed the sum insured as the claims would be payable based on actual costs incurred to repair or replace the property or the maximum sum insured, whichever is lower. If the cost of repair or replacement of the insured property is higher than the sum insured, then the insured would be responsible for the extra amount above the sum insured limit.

    This section covers the direct physical loss or damage to the insured property due to:

    • Fire and allied perils occurring at the venue of the event
    • Earthquake resulting in equipment damage
    • Lightening
    • Explosion/ implosion at the event
    • Aircraft damage to the property leading to equipment damage
    • Impact damage to the insured property resulting in equipment damage
    • Subsidence, Landslide and Rockslide
    • Bursting and overflow of overhead apparatus, water tanks and pipes
    • Missile testing operations
    • Leakage from sprinkler installations resulting in equipment damage
    • Bushfire excluding forest fire
    • Burglary and/or theft at the event resulting in equipment damage

    The personal accident insurance policy offers financial assistance to the insured and relatives in the event of death or disability of the person insured. Personal accident policy is given on a named basis in which the named insured would be covered for death, permanent partial disability, and permanent total disability. The personal accident section covers the death or disability arising out of accidental events, and an accident for the purpose is defined as an unfortunate, unexpected and unintended event resulting in bodily injury. Personal accident policy provides compensation in case of bodily injury resulting in death or disability caused solely by violent, visible, external, and accidental means. The personal accident policy is offered on a named basis in which the name and designation of the insured should be mentioned clearly for the coverage to be applicable. According to this clause, loss of life or disability for the insured as a result of intentional self-injury or suicide or attempted suicide, as well as accidents that occur while intoxicated by alcohol or other drugs, are not protected.

    Events attract a crowd, and there can be accidents resulting in third-party injury or property damage during the event or in connection with the event. These claims are also insured under the event-insurance policy in the section on public liability. The limit of indemnity for this section has to be declared by the insured before the commencement of the policy. Any liability the insurance company took through an agreement, which would have been incurred without such agreement, must be stated as a proposal. Some insurers would also require details of pyrotechnics or fireworks, lasers, and other explosives to be used during the event. The chance of occurrence of accidents could increase dramatically with the usage of these, and insurers would be wary of such things while underwriting the proposals. It is crucial to remember that any accidents must be reported to the insurance company within the policy's duration under the policy's conditions and terms. The claim would be paid according to the indemnity limit.

    Events include money, and theft or robbery could occur. To cover such uncertain events, the money insurance section in the event insurance helps the insured customers recover their losses. The money insurance cover would be provided only on display of adequate security on the premises.

    The coverage under money insurance includes:

    • An actual or attempted burglary occurs in the coverage period, and the money is protected only if the insured property is within the Safe or Strong room.
    • During the policy, robbery can be accessed at the cashier's till or counter at the premises insured during working times.

    Add-ons provide additional coverage in the event of an accident that is available with the payment of costs. These add-ons would alter the terms and conditions of the event insurance policy and would override the existing conditions of the policy.

    Named Artist Cover

    The cover intends to provide coverage to the artists performing in the event on a named basis. For this, the details of the artist, such as name, age, occupation, and travel arrangements, should be mentioned in the proposal form. This is generally used to honor guests of the dignitary or taking part in the event.

    RSMD Cover

    Riot, Strike, and Malicious damage cover can be covered as an add-on after payment of an additional premium. Events could also get canceled due to riots, strikes, and malicious damage, which could cause considerable losses to the event organizers. RSMD cover can be opted for only when taking the policy rather than mid-term. There could be situations where the events are stopped due to the malicious intentions of outsiders, causing considerable losses to the organizers.

    Adverse Weather & Unseasonal Rain Cover

    Events are usually organized indoors, but some events could be organized outdoors, which are exposed to weather conditions. Weather conditions such as unseasonal rain, floods, cyclones, dust storms, etc., could damage the property and lead to the cancellation of events. Such perils could happen when one is unprepared to handle them and may expose vulnerabilities in the planning. One may opt for an additional premium for adverse weather and an unseasonal rain cover add-on to overcome this. Event organizers should prefer adverse weather add-ons in places such as Rajasthan, where the chances of desert storms are high.

    Terrorism Cover

    The other add-on in the event insurance is the terrorism cover which includes the loss or damage to the insured property due to terrorist activities. The add-on is designed to cover the damages or losses that result directly or indirectly related to terrorist acts, regardless of other events contributing to the same sequence or that resulted in damage. Terrorism cover can be useful for events being organized in terrorist-infected areas. Terrorism cover could be taken on payment of an additional premium at the time of issuance of the policy.

    Exclusions:


    Certain exclusions are not covered under the event insurance policy, which are mentioned below:

    • Acts of God include floods, storms, typhoons, tempests, hurricanes, tornados, cyclones, etc., and similar natural disasters and disturbances unless otherwise covered under the add-on.
    • Willingly not adhering to the statutory conditions resulting in losses.
    • Financial losses due to war, riots, political disturbances, fear, hoax, strikes, bandhs, civil commotions or unrest, and malicious activities unless covered under the add-ons.
    • Losses arise from personal reasons such as childbirth, menstruation, communicable diseases, suicides, self-inflated injuries, etc.
    • Any loss due to government intervention due to requisition, confiscation, detention, abandonment, or destruction by order of the concerned authorities is not covered under the event insurance policy.
    • Financial losses arising from carelessness or negligence, fraud, non-appearance of a guest except for the coverage mentioned above or loss due to pollution.
    • Damages from any vehicle or trailer under the insured's control are stored on the premises.
    • Loss or damage to the visitor’s clothing and personal effects.
    • Damages due to fraud or mis-represenation of facts.

    Importance of Event Insurance


    While event insurance is still in its nascent stage in India, it is important to understand the need for availing of this insurance


    Peace of Mind

    The first and foremost advantage of event insurance is that the event organizers would have peace of mind and need not worry about losses they would suffer in case of cancellation of the event or property damages due to an insured peril. Event organizers could also make necessary arrangements for the participants and other concerned parties in case of cancellation of events. One can focus exclusively on the event and make it a grand success instead of worrying about perils such as fire, liability claims, etc.


    Reduce Financial Losses

    One of the most important aspects of event insurance is that it could reduce the financial losses to the insured parties in case of cancellation of event, property damage, personal accident and liability claims which may arise during the policy period. For example, let us assume that the event is canceled due to fire and the tickets sold are to be reimbursed to the participants and there could be other non-recoverable costs which would cause financial loss to the insured members. All such losses could be reduced by availing the event insurance policy, if not for the event insurance one could run into huge losses depending on the scale of the event.


    Boosts Morale of the Performers

    The other advantage of taking the event insurance is that it boosts the morale of the performers. They needn't be concerned as they may be protected under a named basis for bodily injuries or property damage within the coverage period. One can increase productivity when accidents and subsequent hospitalization do not pressure them.



    Claim Settlement in Event Insurance

    Step 1: The first step in the claim settlement process of event insurance is to inform the insurance company regarding the loss. The insurer would ask for certain details, such as the date and time of loss, third-party losses, and a brief report. Once these details are noted, a claim reference number will be generated from their end. This number should be used for all future references while contacting the insurance company regarding claim settlement.

    Step 2: In the next step, the insurance company would arrange for the surveyor to inspect the damaged property to ascertain the loss. The surveyor would usually be deployed within 24 hours of the notification of the claim and would inspect the accident site to arrive at the quantum of the claim. A detailed survey report would be prepared and shared with the insurance company for processing the claim. Readmore..

    Event Insurance
    Event Insurance

    Interesting Covers in Event Insurance

    Event insurance is quite famous in developed economies and is also gaining traction in India. In developed countries, event insurance could even be customized to the needs and requirements of the insured parties. Currently, in India, only a couple of insurance companies offer event insurance plans, including ICICI Lombard, BAJAJ Allianz, Future General, Liberty General Insurance, etc. Here are a few exciting event insurance covers available in Western countries.

    Liquor Liability

    Events in Western countries are only complete with liquor. There might be instances where people could drink too much liquor and hurt themselves or others; there could be instances where there are altercations between people who intend to settle scores after having liquor. In such cases, people can sue you for allowing access to excessive liquor, causing damage. Such liability claims would be covered under the liquor liability cover in the event insurance policy.

    Care, Custody or Control Liability

    Most event insurance plans do not cover physical damages or losses to property under the organization's custody, care, or control. This is due to the argument that the property does not belong to the insured and is only kept in the insured's custody. The loss or damage to the property would not affect the insured, but there can be certain instances where the insured could get sued for damage to the property in their custody and needs coverage. For example, you have rented a car for your event, and during the celebration, the car had some scratches requiring painting which should be borne from your pocket if you don't have an event insurance policy. Liabilities like these are settled under this clause.

    For more information on event insurance plans, please visit Ethika insurance broking and discuss with our insurance experts.