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Events and production
Event cancellation insurance pays back the costs you have committed, or the income you lose, when a business event is cancelled, postponed or cut short for reasons outside your control. It matters because most event costs are committed months before ticket, sponsorship or exhibitor income is safe.
Part of: Event organisers' insurance
In short
Business event cancellation cover is usually written for a named event, with a sum insured based on either your irrecoverable costs or your expected net income. Common triggers include damage to the venue, travel disruption and authority instructions, with adverse weather and non-appearance of key people often available as extensions. Most policies now exclude communicable disease or cover it only in limited form. Cover has to be bought before a threat is known, and poor ticket sales or a commercial decision to cancel are usually excluded. All cover is subject to the insurer's acceptance and the policy terms.
A business event cancellation policy is usually written for a named event or a programme of events, with dates, a venue and a sum insured. When an insured cause forces you to cancel, postpone, cut short or move the event, it pays the loss you can show, up to that sum insured.
The sum insured is normally set on one of two bases, and choosing the wrong one is a common reason a claim pays less than expected.
| Basis | What it protects | Usually suits |
|---|---|---|
| Costs (expenditure) | Money you have spent or are contractually committed to and cannot recover: venue hire, staging, catering, marketing, travel. | Conferences, product launches, awards dinners and internal events with little ticket income. |
| Revenue (net income) | The income you expected, such as ticket sales, sponsorship and exhibitor fees, less the costs you save by not running the event. | Ticketed shows, exhibitions and festivals where income exceeds costs. |
Insurers usually expect the sum insured to be your realistic total, not a guess. If costs rise as the event grows, tell the insurer and increase the figure, or you may be underinsured. Our guide to underinsurance and the average clause explains how a shortfall can reduce a claim.
Wordings differ, but most business policies respond when an event cannot go ahead, or cannot go ahead as planned, because of a cause beyond your control and the control of the people you have contracted with. Typical triggers include:
Policies are rarely triggered by poor ticket sales, a lack of interest, a decision to cancel for commercial reasons, or the failure of your own business or a supplier. Those are commonly excluded, so check the list of exclusions as carefully as the list of covers.
Weather is the cause organisers ask about most, and it is often the most restricted. Insurers commonly cover weather only where it makes the event impossible or unsafe, or where the venue, police or local authority stops it, rather than where it simply keeps people away. Outdoor policies often set conditions, such as a contingency plan, structures inspected to the supplier's specification and someone monitoring forecasts.
Illustrative: a two-day outdoor food fair is called off on the second morning after the safety officer closes the site because of high winds and the risk to temporary structures. A weather extension written on a costs basis might pay the irrecoverable second-day costs. If the organiser had cancelled the night before because attendance looked poor, the claim would probably fail.
Cover must be in place before a threat is known. A policy bought once a named storm is forecast will usually exclude it. Some organisers use a weather index policy that pays a fixed sum if measured rainfall or wind passes an agreed level; see parametric weather insurance.
Non-appearance cover pays when a named person cannot attend because of illness, injury, death or, in some wordings, travel delay. It is usually an extension, priced on who the person is, how many appearances are involved and their health.
Some wordings pay the extra cost of a reasonable substitute rather than the full loss.
Since the Covid-19 pandemic, most event cancellation policies exclude communicable disease altogether, or cover it only as a limited, separately priced extension where an insurer offers one. Where cover is offered it usually applies to specific situations, such as a government order closing the venue, and excludes diseases already known about when the policy starts. Our page on pandemic insurance explains why the market changed.
Other common exclusions include:
A cancellation policy would not normally pay the cost of complying with Martyn's Law. The government's Martyn's Law factsheet says events with 800 or more people present at the same time can be in scope, once the duties are in force. See Martyn's Law explained.
An event cancellation claim is measured against what you could not recover. Insurers will usually look at your venue and supplier contracts first, including any force majeure clause, deposit terms and refund obligations to ticket holders and exhibitors. If a contract lets you recover money, the insurer will expect you to recover it. Where neither side can perform, the law on frustration may apply; our contract frustration page explains the basics.
Under the Insurance Act 2015, a business must make a fair presentation of the risk before cover starts. For events that means telling the insurer about the venue, any outdoor elements, the people the event depends on, previous cancellations and anything you know that could affect it. See fair presentation under section 3.
Conditions such as weather monitoring or structure inspections are often designed to reduce a particular kind of loss. Under section 11 of the Insurance Act 2015, an insurer cannot rely on a breach of that kind of term if you show it could not have increased the risk of the loss that actually happened. It is still far safer to comply.
Apex arranges insurance for events and film and TV production. A broker reads each enquiry and comes back with options; there is no fee for a quote, and cover is always subject to the insurer's acceptance and the policy terms. To quote we need your business activities, turnover, location and claims history, plus the event dates and venue, expected attendance, a budget of costs or forecast income, any outdoor elements and the names of any key speakers or performers.
For the rest of the event programme see event organisers' insurance, public liability for event organisers, what venues ask hirers for and festival insurance. For private events, see personal event cancellation cover.
It usually covers the irrecoverable costs, or the lost net income, when a named event is cancelled, postponed, cut short or moved for a cause outside your control, such as venue damage or travel disruption. Adverse weather and non-appearance of key people are often optional extensions. Poor ticket sales and commercial decisions to cancel are usually excluded.
Sometimes, usually as an extension for outdoor events. Insurers commonly pay only when weather makes the event impossible or unsafe, or an authority stops it, not when it simply lowers attendance. Cover must be bought before the weather is forecast, and conditions such as a contingency plan often apply.
Usually not. Most policies written since the pandemic exclude communicable disease, or offer it only as a limited and separately priced extension for specific situations, such as an official order closing the venue. Diseases already known about when the policy starts are normally excluded, so check the wording carefully.
As soon as you start committing money, typically when you sign the venue contract or pay deposits. Cover usually excludes anything known when the policy starts, so buying late can leave out the very risk you are worried about. You can normally increase the sum insured as the budget grows.
Costs cover pays the money you have spent or committed and cannot get back. Revenue cover pays the net income you expected, such as ticket and sponsorship income, less costs you save. Costs cover suits free or low-income events; revenue cover suits ticketed events that should make a profit.
Tell us what your business does, your turnover and any claims. A broker reads every enquiry and comes back with options. No fee for a quote. Or call 0117 325 0027.
Start a commercial enquiry Request a callbackApex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales, company number 07014570. This page is general information, not advice on your individual circumstances, and it does not guarantee that cover will be available or on what terms.
