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How the Pandemic Has Affected Event Insurance and What to Expect in 2021

Skift Take

Event insurance has been a complicated subject since the start of the Covid-19 outbreak, with providers and planners clashing over potential payouts. Now, coverage is getting more expensive but removing protections for the most worrying risk: the pandemic.

Insurance companies offer an important service, but they’re often less useful than they should be as they tend not to provide adequate (or affordable) coverage for situations that are likely to occur. In general, the more likely a scenario, the more expensive coverage against it becomes.

The insurance industry is simply not built for mass payouts, which is exactly what it faced in 2020, and the ramifications of that will continue to affect policies for the foreseeable future. We now know more about the extent of the virus’s impact, but the timeline for recovery is still unclear, especially with new variants on the rise.

As event planners begin work on in-person events taking place at the end of this year and throughout 2022, it’s important to revisit the question of event insurance and to understand the implications for events moving forward.


Insurance Fallout From Covid-19

Early on in the pandemic, some event planners were able to invoke the force majeure clause in their insurance contracts to recoup their losses due to cancellation, but it was very much on a case-by-case basis.

As concerns mounted over the Covid-19 outbreak at the beginning of last year, insurance companies wasted no time in removing epidemic and pandemic clauses from their offerings, ensuring that any planners who were successful in receiving an insurance payout would not be so lucky in the future. Taking out a policy including pandemic coverage is still near impossible, and that won’t be changing anytime soon.

Insurance companies, like everyone else, are recovering from a brutal 2020. Liberty Mutual reported Covid-related losses of $520 million in the second quarter of 2020 — about $260 million of which it attributed to event cancellations — and the company expects another $50 million in event cancellation claims this year.


The Future of Event Insurance

The fact that policies no longer include possible extensions for communicable diseases makes event insurance particularly unhelpful given that we’re still in the middle of a pandemic.

To add insult to injury, some insurance companies are now hiking up their rates. According to Carl Baxter from Miller Insurance, policies are now 25-100% more expensive than they were before the pandemic for the same coverage.

Planners will need to weigh their options carefully as the cost of insurance increases but the available plans are essentially less effective. It remains essential for event organizers to include sufficient protections in their own contracts with clients and suppliers to mitigate their risk.

Additionally, some insurance companies are now offering specific coverage for virtual events. Online events don’t require a lot of the same liability insurance as in-person events, but there are still some risks. These policies protect against losses resulting from technical failures, which may be worth considering for planners running virtual events.



The pandemic has caused millions of dollars worth of losses for both the event and insurance industries, and the latter has taken steps over the past several months to protect itself from further virus-related claims.

This is typical of insurance providers since communicable disease is now a high risk, but it’s incredibly frustrating for those paying high premiums in exchange for less coverage. When it comes to the coronavirus, planners will not be able to rely on insurance for their future events, and should make sure to fully evaluate any potential risks in order to adequately protect themselves.