Insurance And Sporting Events
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Wimbledon and the British open Golf can go ahead and cancel their events knowing in full well they have insurance. This has been something Wimbledon has not scrimped on and has had full coverage for the last 17 years which covers cancellation due to a pandemic.
The IOC has the Olympics covered as well for a whopping $800 Million. strangely enough if the event is going to be cancelled or postponed insurers would rather know sooner than later. The closer the event gets to the starting date the more the organizers spend and insurers have to cover. The IOC would pay in the region of $24 Million for this cover and would cover every scenario.
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Wimbledon will receive a reported $141 Million for not hosting this years event. Still a loss on what they were expecting to earn, but then again not a total disaster. Going by previous profits this will at least give them half of what was expected and in a better position than most other sports who don't have this extra clause in their insurance.
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No one could foresee what has been going on over the last few months and was just built into their costs. This would be an expense built into their forecasting and claimable by the tax they pay out. I am sure many sports will be looking or have been looking what they are covered for and cursing. This will be a definite tick going forward and expect insurance policies to be more expensive in the years to come.
I know from previous experiences I have always taken the extra insurance whether it is for a hired car or for my personal house cover. Most have a clause called an act of God which covers many natural disasters, but a pandemic is not one of them. Hosting an event though nothing should be left to chance.
Wimbledon paid an extra $2 Million to have everything covered that included terrorist attacks to National Mourning just in case the Queen died. I think the terror attacks would be something most events would be covered for. If there wasn't the automatic mourning period when a monarch dies then possibly they wouldn't have had every scenario covered.$34 Million paid out over 17 years and received back $141 has been a sound investment. Very few have paid for the clause “force majeure” or "superior force" Some sporting bodies have been set back many years financially and some clubs involved may never recover.
Insurance Companies can expect this as an upsale not only in the various sporting codes,but many large businesses as well. Nothing will ever be taken for granted now and never should. The ticket prices will have to cover this added expense in future.
My question is what sort of insurance company has this kind of money to pay out? 800 million? wow! I wonder if this ends up having policy impact on people who are insured for say, health or car. I hope not.