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Why Contingency Insurance Should Be Top of Mind with Live Event Producers

Today, everyone from Fortune 500 companies to small, local market producers is looking to live events to boost their market profiles and sales, as the customer experience has become the holy grail of the market economy. According to data compiled by market researcher Bizzabo, B2B events reached $512 billion in annual spend five years ago and have been moving upward ever since.

As these live events become increasingly important, they have also become infinitely more complex and expensive to produce, and they are exposed to a host of real-world exigencies including inclement weather, equipment failures, stage collapses, fires, performer no-shows and, yes, malicious acts.

Several types of insurance already cover things like property damage and loss of income. For instance, if a lighting truss were to topple and crush a rack of amplifiers for the P.A. system, a standard property damage policy would address the equipment owner’s loss of the gear and loss of the use of the, and if someone were to be injured in that instance, there are standard liability policies that would cover that.

But given the increasing number and scale of live events, another category of coverage is becoming critical: contingency insurance. When a concert, play, or private, charitable, or political event must be cancelled or postponed, how do those funding the activity recoup the expenses already laid out or access available funds to reschedule? The answer is contingency insurance, which are policies intended to provide coverage for loss of income, loss of expenses already paid, and extra expenses required to reschedule an event when there is a business interruption not covered by standard property business insurance.

These policies can be customized to address the highly specific requirements of each event. For instance, an outdoor event can be insured against weather contingencies such as wind and storms; if a performing artist at the event is a no-show, the resulting loss can be covered. And the coverage can extend as broadly as each situation necessitates. For instance, if a covered contingency arises that forces the cancellation of an event, coverage could extend to service providers such as sound reinforcement and catering, and to performers’ fees and transportation.

The policy provides coverage missing or excluded from the standard property insurance policies, such as cancellation caused by weather conditions; key performers not reaching the event due to weather, illness, injury, or death; and even cancellation due to terrorism or the threat of terrorism.

The concept is surprisingly not new. In fact, it has been around almost as long as modern insurance itself. However, it’s been relatively little used in the event production industry, as the live event sector has mushroomed. Even insurance agents and brokers are still not sufficiently aware of how critical contingency insurance can be.

Now this all might sound expensive, but like all insurance policies, you have to weigh that cost against what the potential losses could be if the event fails to take place as planned, which can run into six- and seven-figure amounts. It’s also worth noting that the premium costs for contingency policies as a category have decreased substantially, a collateral benefit of the proliferation of live events. In addition, the amount of data that insurance carriers use on which they base their underwriting costs has grown. For example, they can look at incredibly detailed records of weather history at a given location and predict with a high degree of accuracy what the weather will be at a designated time in the near future. All of that data means underwriters can get a very clear picture of any risks that a live event might encounter. Taking all those factors into account, this kind of insurance is not only increasingly necessary but also increasingly affordable.

Contingency insurance will only become more necessary as the market evolves. The U.S. Bureau of Labor Statistics predicts that employment of meeting, convention, and event planners—a key indicator of the entire sector—will increase by 11 percent from 2016 to 2026, faster than the average for all occupations. With ever-increasing costs to put on events and so many businesses having a significant potential loss of income and prepaid expenses, this is one of the few options available to make all stakeholders whole. If you’re at all involved in the production or staging of a live event, take the time to review your coverage with your insurance agent.

Richard Rutkin

Richard Rutkin is executive vice president of business development at Take1 Insurance. He has providing insurance and risk management options for the entertainment, sports, and leisure industries for over 25 years and has over 45 years of experience in the insurance industry. Rutkin can be reached at and will gladly review insurance policies.