Why Music Festival Insurers May Not Pay Out on a Claim.

The large amounts invested in creating and running sizable music festivals requires comprehensive insurance to prevent financial loss if something untoward occurs. Insurance for festivals can be complex and expensive, and it is not uncommon for insurers to refuse to pay out against a loss. What solutions are there for organisers who want solid coverage against unforeseen incidents.

Event insurance usually covers potential financial loss when organisers are forced to cancel, or external forces have inflicted damage to property. An outside music festival can be vulnerable to extreme weather (storms, floods, wildfires) and even geological events like earthquakes. When considering what insurance to purchase festival organisers should fully understand the terms and conditions which will dictate if the insurer will pay out should a claim be made. 

Event Insurance. 
It is common for music festival entities to purchase a number of specialised insurance policies which relate specifically to their activities. Like every business there is a requirement for compulsory Public Liability Insurance covering injury or damage related to anyone on a site and is usually a requirement as part of obtaining the necessary permits. Specialist insurance related to event cancellation will usually cover losses if the festival is cancelled, postponed or abandoned due to extreme weather or natural disasters. Additional insurance specifically for adverse weather is also a common policy considered by organisers and may cover losses related to rain, lightening, high winds, flooding and heatwaves for example. In some instances, organisers may consider a specific policy for property and equipment damage caused by adverse weather or natural disasters. Most festival organisers will consult event insurance specialists to find the right policy which suits their requirements and may consist of several separate policies or one single comprehensive policy that covers everything. 

Common Reasons for Claim Denial. 
Insurance companies have a reputation for frequently denying claims or delaying compensation for an extended period. The most common reason for denial is that an incident is not covered because it falls under a policy exclusion. A breach of contract is also common where insurance investigators find that event organisers have failed to comply with safety or security protocols. Insurers have very strict guidelines regarding the submission of claims including timelines and specific claims processes and can be a reason to reject a claim. Finally, insurance companies always consider the possibility of a fraudulent claim being made leading to delays pending further investigation. 

Natural Disasters. 
Despite some insurers claiming that they cover natural disasters this may also be referred to in terms and conditions where incidents considered ‘Acts of God’ like hurricanes, earthquakes or pandemics are excluded. It is also common for incidents of terrorism or civil unrest to be excluded. The wording used in policies and their exclusions can sometimes be vague, so organisers need to fully understand when agreeing to a policy exactly what is and is not covered. 

Solutions for Comprehensive Coverage. 
Most festival organisers use specialist event insurance experts to find the right policy or policies to meet their requirements. This needs to be balanced with the likely premium costs which can be incredibly high if organisers want to cover every eventuality. In some cases, an insurer may be able to offer some level of customisation for policies and even reduced premiums if the organiser can demonstrate robust processes and procedures for the festival's overall safety. Organisers can consider having a higher excess or deductible included in their terms which can significantly reduce premiums. 

For festival organisers planning their next events using a software management platform like Festival Pro gives them all the functionality they need manage every aspect of their event logistics. The guys who are responsible for this software have been in the front line of event management for many years and the features are built from that experience and are performance artists themselves. The Festival Pro platform is easy to use and has comprehensive features with specific modules for managing artists, contractors, venues/stages, vendors, volunteers, sponsors, guestlists, ticketing, site planning, cashless payments and contactless ordering.

Image by Schäferle2 via Pixabay

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