Event cancellation insurance

Event cancellation insurance, which the US market files under contingency insurance, pays the organizer when an unforeseen outside event forces a cancellation or postponement. It covers either the costs incurred or the net revenue lost, a choice made at inception. Textbook case: a sixty-date world tour, 120 million euros of guaranteed revenue, and the headliner hospitalized for heart surgery two weeks before opening night. The non-appearance section responds, on net revenue lost less the variable costs the organizer never incurred. The market splits it into sections: abandonment and cancellation, non-appearance, adverse weather, physical damage to the venue. What the policy covers is read section by section, and what it does not cover turns first on the cause. A show called off for poor ticket sales, a commercial dispute or the organizer's insolvency stays outside the policy. It gets confused with business interruption, which needs prior physical damage, and with the force majeure clause in the venue contract, which allocates losses between the parties and indemnifies nobody. On a tour, pricing follows the person more than the show, meaning age, health and cancellation history, and underwriters often ask for a medical exam. On a trade show or a convention, it follows the venue, the season and the political calendar. Covid-19 was the line's systemic loss, with billions of dollars claimed worldwide. Since 2020 almost every policy excludes communicable disease, or covers it only under a sub-limit and a waiting period. Capacity remains heavily concentrated at Lloyd's.