On 5 August, the government announced that it is partnering
with insurers to offer a cost indemnification insurance
scheme which will make cover available against the
cancellation, postponement, relocation or abandonment of
events due to new UK Civil Authority restrictions in response
to COVID-19.
The Live Events Reinsurance Scheme will support live events
across the country — such as music festivals, conferences and
business events — that are at risk of being halted or delayed
due to an inability to obtain COVID-19 cancellation
insurance. Cover will be available to purchase alongside
standard commercial events insurance for an additional
premium.
This intervention will support the UK’s economic recovery
from the COVID-19 crisis by giving events the confidence they
need to plan for the future, whilst also ensuring that we
deliver value for money for taxpayers.
The headline scheme rules, as published by DCMS, can be found
on this page. Full scheme rules will be available on this
page in due course.
We have taken care to ensure that the product offered is
closely aligned with those available on the market prior to
the COVID-19 crisis. Key features of the scheme are as
follows:
- The Live Events Reinsurance Scheme is a cost
indemnification scheme which protects against costs incurred
due to the event being legally unable to happen due to new
government COVID restrictions.
- The scheme will cover live events that are open to the
general public and are physically located in the UK. This
includes live music events, festivals, sports events, trade
shows and business events. Private events such as weddings
and parties would not be covered.
- In order to be eligible, event organisers must purchase
the relevant cover from participating insurers within the
scheme. Event organisers must also have or purchase a
standard events cancellation policy (or a policy which
includes event cancellation coverage) provided at least in
part by a participating insurer – the cover backed by the
scheme will not be offered on a standalone basis.
- Premium is set at 5% of the total value of insured costs
(plus Insurance Premium Tax).
- Claims will be subject to an excess of 5% of the value of
the insured costs or £1,000 (whichever is higher) per policy.
- Event organisers can purchase cover up to the full cost
of their event, irrespective of when those costs are
incurred.
- Cover must be purchased at least 8 weeks prior to the
event taking place. This requirement will however not apply
for the first 12 weeks of the scheme.
- The government’s expectation is that participating
insurers will pay no brokerage in connection with the scheme
and no deductions for such brokerage will be made to any
premiums paid by insurers to DCMS in connection with the
scheme.
The scheme will not cover loss of revenue prompted by lower
demand for tickets or venue capacity, and the scheme does not
cover self-isolation of staff or performers. The scheme will
cover a limited series, or run, of linked events, provided
that the event organiser specifies which event dates from
that limited series, or run, require cover and how much cover
they are purchasing for each.
The Scheme will run to 30 September 2022 with a review point
in Spring 2022. Cover will be available to purchase through
participating insurers. A number of prominent insurers in the
Lloyd’s market, including Arch, Beazley, Dale, Hiscox and
Munich Re are supporting the scheme, and we expect more to
follow. Event organisers can now start approaching these
insurers to discuss their cover.
We will be periodically reviewing the scheme to make sure it
achieves its objectives to support live events following the
impacts of COVID-19.
