Event Cancellation Insurance What happens when there is a pandemic?
It is a fact that the health crisis caused by COVID-19, in which social distancing has been imposed as a key factor in the fight against the virus, is having a great impact on all aspects of society.
Even before the declaration of the State of Alert, events such as the Mobile World Congress were closing, to which at that time, few saw what was coming and that is that both events of this kind as festivals, cultural events, religious celebrations, regional festivals or sports events have been or will be canceled in the coming months.
In view of this situation, little has been shown about the importance of event cancellation insurance, which offers a range of coverage designed to cover expenses and outlays in the event that these events do not take place
The main doubt that arises in this type of policy is whether it offers coverage against epidemics, pandemics, or diseases of any nature, since the usual practice in the general conditions of these insurances is to consider them as an exclusion.
WHAT DOES THE EVENT CANCELLATION INSURANCE COVER?
The purpose of event cancellation insurance is to reimburse the economic losses arising from the costs incurred, as well as any profits lost as a result of the cancellation, postponement, interruption, reduction, relocation or abandonment of the event for reasons beyond the control of the event organiser.
These reasons can range from weather phenomena, political and social events, failure of the key person(s) to appear, unavailability of the venue, interruption of the delaying connections, accidents, mourning, illness according to scenarios etc. In this sense, it is of great importance for the insured to analyse exclusions and terms of coverage and to verify the applicable law since most insurance policies for large events come from the United Kingdom.
WHAT HAPPENS IN THE FACE OF A DISEASE OR A PANDEMIC?
As a general rule, cancellations due to illnesses are excluded unless they are expressly covered by an additional premium.illnesses are presented as one of the risks covered by these policies, especially specific diseases with exclusions of specific viruses (Ebola, Zika, Yellow Fever, SARS...) so that these diseases are designated with their scientific name to highlight the lack of insurance coverage against them.
As it is a recent virus, the Coronavirus is not expressly included in the list of these policies. However, if the precaution has been taken to complement it with an additional exclusion of coverage against quarantine, epidemic, pandemic or contagious disease, it could act as coverage against this virus. Not forgetting, from a technical and legal point of view, the great complexity of covering this type of risk
In short, the COVID-19 will affect cancellation insurance and many other forms of insurance and only the end of this situation will determine the future of them.