Events Insurance is used to cover everything from a child's birthday
party in the park to the Superbowl half-time show, and literally
countless thousands of other events lasting from a few hours to
a few weeks. Special Events Insurance is a term for a type of insurance
that varies wildly in scope, but often refers only to limited liability
coverage for injury or damage occurring during an event. It is an
insurance product that particularly lends itself to misrepresentation
and outright fraud because it is at times bought in a last minute,
frantic rush to meet venue requirements, with little attention to
insurer identity, actual policy content, or the broker offering
it. Event producers may be so hopelessly preoccupied that they find
themselves within a day or two of an event, only to be reminded
(or told for the first time) by the venue about this little detail.
Venue owners can and will refuse to permit an event, absent the
required insurance certificate. If you find yourself in this situation,
read fast . . .
it Costs . . . Common
the fine print and frauds.
Exclusions - What's not covered.
Damage to the Venue - "Third
Party Property Damage"
Rides and Amusement Devices
it Costs . . . Common
Costs run from as little as $150-200 for a small
family event to thousands (sky's-the-limit) for big concerts,
fairs, hazardous sporting events, motor racing, etc. Smaller events
considered relatively low-risk can usually be insured for $300-500.
Everything else is in between. These very approximate
costs would represent premium for a common, limited liability policy
with no enhancements. Much depends on the expected attendance
or gross revenue at the event. (Underwriters ask for this information
to quantify risk & use it to determine your premium.) Special
endorsements or modifications required by your venue (or by city
or other governments) may drive the cost up.
There are super-cheap policies (About $100) around
for very small events, i.e. weddings, birthdays, bar mitzvah, bat
mitzvah, which contain many exclusions & effectively reduce
the insurance to cover only the acts of the bridal party, honorees
and/or guests. If you have homeowner's insurance that would fill
in where the exclusions apply, the cheap policies may suit your
need. Ask your agent.
Most policies offer optional insurance for such
things as liquor liability, vehicles, venue damage, rented equipment
or props, medical insurance for athletic or other participants,
loss of revenue or costs due to event cancellation, etc. These
items usually add considerable insurance expense.
Venues will usually expect at minimum a $1,000,000
general liability insurance policy, and most expect to be named
on the policy as an "Additional Insured.". They
are, in general, surprisingly uninterested in reviewing actual
policy language, however you need to be careful in asking for
their requirements. Get their sample certificate or other written
specs if at all possible; otherwise you risk having paid for insurance
they will not accept. (And getting a refund on Special Events
Insurance can be all-but-impossible, even when your event is canceled.)
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the fine print and frauds.
In the vast majority of cases, special events
insurance is bought shortly before the actual event, and policies
arrive (if at all) sometime after the short-term
insurance has run its course & expired. (Many programs operate
using only certificates with reference to a master policy, and
individual event policies aren't issued at all.) It is therefore
extremely important to get documentation of what insurance you're
buying in advance.
You must also choose the days you're covering
very carefully. Policies usually take effect at
12:01 A.M. on the indicated date, and expire at 12:01 A.M. on
the indicated date. Claims for anything occurring outside the
dates are simply not insured. If you have some pre-event set-up
or other activities taking place, or takedown or other closedown
activities, those dates must be included. If your social event
is expected to end at 10 or 11 PM, but guests linger past midnight
or will be traveling home past midnight, your insurance must include
the following day or you risk having no insurance for what might
be the most likely claims. If you are renting equipment, props,
etc & the rental company requires insurance, you'll have to
start coverage on the day you pick it up & continue it until
the day after it's returned.
Fraud & misrepresentation may be very difficult
to spot. One recently-arrested California broker reportedly has
issued more than 2,700 - yes that's 2700 - fake policies to various
entertainment, special events and sports clients since early 2001.
(The wheels of the insurance department can crank very slowly
indeed.) He reportedly pocketed more than $3.8 Million
in the first two years.
While the internet is a convenient & useful
tool, it is also an insurance fraudster's dream come true. The
fancy website that processes your quote may be run by some guy
in his underwear at his bedroom computer in Bangladesh whose sole
motivation is to obtain your credit card or bank routing number.
There are also more sophisticated schemes at work in the U.S.
on a regular basis. Anyone who offers you insurance for $100 or
so is highly suspect. (Doesn't mean the policy is worthless,
but likely to offer little-to-nothing in coverage.) Buying from
an Internet-based program is often the best method, but you simply
must establish some basic identifying information
before you pay:
A) Find out the physical location address of the
broker-agent & his/her state of residence and state license
B) Look up the license on your state insurance department and
see if it's active.
C) Ask for the name of the insurance company (Not the agency
name), financial letter rating and whether licensed in your state.
(This should also be verified on your state insurance department
D) Obtain a written, detailed quote & coverage description
listing your event by title & location, exclusions, deductibles
(if any), policy limits, the name of the insurance carrier, effective
and expiration dates, total cost including fees, & payment
terms. ... Back to Top ...
- What's not covered.
This is a list which is limited only by the underwriters'
imaginations, which is to say it is essentially endless. Some
- and only some of the more common exclusions
seen in special events insurance are:
Vendors (Your liability for acts of Photographers,
caterers, entertainers, etc.) These policies usually much cheaper.
Liability for injuries to vendors.
Rides or mechanical or other amusement devices
Assault & battery (fights)
Liquor Liability - Host or Liquor Legal Liability (May be available
as an option)
Autos - Vehicles (May be available as an option)
Workers' comp-employer's liability (Rarely available as an option
& often hard to find.) Anyone providing
services to your event may attempt to collect benefits from
you. Liability for injury to participants
in sports or other contests/activities (May be available as
Intellectual property liabilities
Damage to the venue (May be available as an option)
Loss of revenue or expenses due to event cancellation (May be
available as an option)
Rented props, equipment, etc. (May be available as an option)
Courtesy Medical Payments
Professional liability/errors & omissions
Abuse or molestation
Stunts or racing
Contractual Liability (Assumed liability.)
Collapse of temporary structures (Seating, Props, Rigging, etc.)
Weapons ... Back to Top ...
to the Venue - "Third Party Property Damage"
Your event policy may exclude damage to the venue
you're renting, and offer it as an option. This exposure is
commonly known in insurance parlance as "Third Party Property
Damage," and subject to a separate limit. When
you signed for use of the venue, you probably assumed responsibility
for damage to it somewhere in the fine print (and you likely would
be legally responsible anyway), so depending on the size and nature
of your event, this is an important coverage to consider.
Many event policies include damage to the venue
only if caused by fire (arguably the most likely & costly cause)
in the basic rate.... Back to Top ...
and Amusement Devices
Rides or amusement devices or apparatus may be excluded
by your event policy. If you have any such exposures, you will need
to either purchase insurance separately or obtain ironclad documentation
from the ride operator that insurance is supplied in adequate limits
and with your name added as an additional insured. The risk in having
an operator provide a certificate, however, is that the insurance
certified may not, for numerous possible reasons be responsive.
Examine certificates carefully and have your insurance agent
review them as well.... Back to Top ...