Demand for live shows has reached pre-pandemic levels — unfortunately, insurance rates on concert and event venues have risen as well.
From property to general liability insurance to event cancellation and workers’ compensation, business rates have risen an average of 15% to 20%, with property coverage and event cancellation having the most dramatic increases.
At the same time, insurers continue to restrict their appetites for entertainment risks, often due to a rise in violent incidents leading to high-severity injury claims. For event venue owners and operators, insurers are now generally unwilling to offer event cancellation insurance unless policyholders agree to at least a deductible of 5% to 10%.
How to meet venue insurance requirements
Here’s five strategies entertainment venues can pursue to ensure they receive adequate coverage at a price they can afford:
- Evaluate risk in a new light. Insurers are scrutinizing entertainment risks closely, especially over violent incidents. Active shooter and violent incidents have led to dozens of injury and wrongful death claims. The frequency and severity of claims has risen in other lines as well, including event cancellation and property. Entertainment venues should use their discretion about what kind of shows they host — and say no to promoters with a poor track record.
- Re-emphasize security. Entertainment venues must have robust emergency plans and security in place, and be able to show insurers those plans will reduce risk during events. Insurers will not consider venues that cut corners. It’s also important to work with vendors that have proof of insurance and add them as an additional insured to policies.
- Allow adequate time to get adequate coverage. Finding insurance in this environment can take much longer than previously, as underwriters are inundated with renewal applications and new business submissions. Entertainment venues need to give proper notice to insurers of any changes that may impact their insurance policy, such as plans for opening new venues or building construction, and do so well ahead of submissions. Try to submit at least 120 days prior to renewal.
- Details matter — don’t omit them. Ahead of renewals, underwriters are demanding detailed information on how a venue operates and the kind of shows it hosts. They want to know if a venue is following best practices for event management and that events don’t invite a high degree of risk. Failing to provide such information increases the chances of policy cancellations or that premiums and conditions will become cost prohibitive.
- Find an entertainment insurance specialist. Like all industries, entertainment has its own particular insurance needs and venues even more so. It’s important that your broker can find insurers that will entertain offloading your venue risk and can structure alternative insurance options, such as higher deductibles or self-insurance, when insurance costs become completely unaffordable.
HUB International’s entertainment insurance team can help you secure the right coverage at an affordable rate for your venue.