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Live performance industry hit by lack of commercial insurance

Live performance industry hit by lack of commercial insurance | Insurance Business

Live performance industry hit by lack of commercial insurance

Theatres and live music venues throughout Britain have said that, due to the COVID-19 pandemic, they can no longer obtain commercial insurance and will only be able to reopen if the government provides a financial backstop, according to Reuters. Only a small number of theatres and concert halls have opened to socially distanced audiences, and many are noting that access to insurance is a barrier to their reopening.

Reuters reported that underwriters have been excluding COVID-19 from coverage which ensures that a theatre has no protection against cancellation, further lockdown due to the virus or legal action from any audience or employee who falls ill. A director at insurance broker EC3, James Davies, noted that these businesses will not be able to obtain sponsors, full-house ticket sales, finance, TV licensing or stars unless these are guarantees.

A survey conducted in May by the Society of London Theatres showed that only 12% of organisations thought they would get the insurance they needed to reopen. Phil Bowdery, chair of the Concert Promoters’ Association, which is one of several trade bodies seeking government aid, noted that COVID is the one thing no-one can get any insurance for right now.

“We’ll take care of all the normal insurance,” he said, “we are asking for the government to be a partner.”

Organisers of live performances throughout Britain are pushing for a scheme similar to the £500 million deal announced by the British government to insure film and TV productions for 70% of their losses (up to a maximum of £5 million) if they have to abandon production because of the pandemic.

Reuters cited a parliamentary committee report issued in July which revealed that, in the first 12 months of lockdown, more than 15,000 theatrical performances were cancelled, with a loss of over £300 million in box office revenue.

The report noted that: “Government must address the urgent need for the UK’s cultural industries to be covered by adequate insurance.”

Tim Thornhill, sales director, entertainment and sport, at Tysers, said that venues and shows will struggle to survive due to social distancing as they will require at least 70% capacity to break even, and a government-backed insurance scheme would be of substantial assistance in helping them to get back on their feet.

Tysers and EC3 are both working on proposals, but the newswire highlighted sources that have revealed that the British government film fund has no insurance partnership due to the reluctance of insurers to provide cover.

“It is difficult for underwriters to justify to capital providers why they should risk more throwing good money after bad,” said one insurer.

A spokesman from Allianz confirmed that the insurer was no longer providing this insurance for cancellation or illness due to COVID-19, while Hiscox declined to comment and Chubb did not respond.