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Contingency risks are usually low probability but high severity. That’s why every policy is tailored around the specific facts of the transaction. For example, the contingency risks that could potentially prevent the successful completion of a sporting event would be quite different to those of a gala or television broadcast.
There are a variety of specific risks that are considered to be a contingency risk:
This provides expense or revenue protection when forces outside your control cause the necessary cancellation, postponement, relocation, curtailment, or abandonment of an event.
If an event must be cancelled due to the death, accident, illness, or travel delay of your hired entertainer, personality or athlete, a non-appearance policy can protect your investment.
National mourning coverage protects you in the event that you incur a loss as a consequence of national mourning declared by the government or monarchy of the country your event is due to take place.
In the event of a terrorist threat in which there is a real risk of physical loss, damage, actual bodily injury or death as confirmed by the relevant government or security service, it’s possible your event might not be able to proceed. In this situation, terrorism insurance safeguards against damages and liabilities up to the total amount of cover. Sabotage, strikes, riots, civil unrest, and political subversion can typically be added.
You can take out standalone weather coverage for named windstorms, extreme winds, electrical storms, rainfall, snowfall, and extreme temperatures. Ordinarily, you can implement this on a per event basis.
Death coverage will pay the insured amount should the insured person pass away during an active policy term.
When an insured person suffers an accident or illness that causes the necessary cancellation or withdrawal of an insured event, a disablement policy will cover the insured amount.
Coverage for disgrace typically protects against situations that bring an insured person into disrepute or provoke insult or shock to the community — particularly when this reflects unfavourably upon an insured, its principals, or its products.
An over-redemption policy offers you protection from excess recoupment above budgeted projections.
With a prize indemnity policy, you can insure against payouts related to games of chance where a prize can be awarded to a winner. This policy would pay, on behalf of the named insured, if any eligible contestants win the game or contest.
For golf clubs and related institutions, Hole in One cover will pay out in the event that someone wins a hole in one prize or similar. This type of coverage could be considered a kind of prize indemnity, but with a variety of specific options tailored towards the golfing niche.
Common in sponsorship, promotional, and/or endorsement contracts, this coverage is designed to pay a bonus on a specified basis to a professional athlete, spokesperson, and/or celebrity if he or she achieves certain contractual goals.
Insurance can cover a key owner/employee who may be crucial to an insured’s business strategy. If this person’s absence could bring about adverse financial implications, key man coverage offers a safety net.
Any live or one-time broadcast event — whether on traditional media (such as network television) or other distributions — may be subject to a breakdown that prevents completion of a transmission. Any associated liabilities or costs can be protected against with transmission failure insurance.
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If you’re seeking flexible, reliable contingency reinsurance, speak to a contingency specialist at Mekong Re.
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