Once again ‘the season to be merry’ is almost upon us and it’s time to plan the party!
However whether you are a business simply planning to entertain clients and contacts or, for example, an organisation planning a music festival or major event for the public next year the principle is the same – don’t forget to check your insurance cover!
The laws that impose duties upon organisers of events, especially from a liability perspective, are surprisingly wide. However, fortunately there is a wide range of insurance cover available and there needs to be as the implications if things go wrong can have a devastating effect upon businesses and those who run them. The critical consideration is to ensure that all potential risks are covered as far as possible.
By way of illustration if a member of the public attending your event were suffer serious injury or die in an accident caused by a failure of your employees or agents to safely erect temporary steps then the consequences could be far reaching. The same would apply if one of your employees suffered serious injury or died due to inadequate supervision or safety precautions taken during their work.
Following a serious accident the law enforcement agencies, which includes not only the Police but The Health & Safety Executive and the Environmental Health Officers of the local Authorities, would immediately commence investigations and could issue a prohibition notice closing the event if they suspected there was a likelihood of reoccurrence.
Further, if they suspected that there were breaches of Health & Safety law then criminal prosecutions could follow against the organisers of the event and/or against the directors or senior officers if their gross negligence caused the incident.
Successful prosecutions could lead to unlimited fines for the business and imprisonment for the individuals concerned together with very bad publicity which could have a devastating effect on the business.
In the event of a death then there would also have to be an Inquest at which the business may have to explain their actions.
In either event there would no doubt be a civil claim for damages either by the injured individual or, following a fatality, by the Estate on behalf of any dependents.
In addition to needing insurance cover for liability risks there are a multitude of other prospective risks and related insurance coverage that should be considered by organisers and it is appropriate now to review some of the more common:
Property: cover for premises against damage, office contents, musical instruments, hired-in equipment, marquees, audio & visual equipment and plant, merchandise stock, CDs, and promotional materials.
Business Interruption: should there be fire, flood, power or a telecommunications failure, then BI insurance offers protection from income streams during physical and technological disruptions.
Employers’, Public and Product Liabilities: Employers liability insurance is of course compulsory and it should cover not only your own full time employees but part time contractors, volunteers and freelancers. Audiences will be covered by public liability insurance and food/drink and merchandise by product liability cover.
Financial: misappropriation, loss of cash, box office receipts, fees, subsistence expenses and merchandise.
Legal Expenses: provides cover for legal advice and representations of your company in health & safety issues, employment disputes, contract disputes and can provides an advisory service. This is often included in a ‘combined risk’ policy.
Professional Indemnity: provides cover against claims of negligence, breach of duty or mismanagement.
Cancellation Insurance Cancellation cover replaces lost revenue and reimburses expenditure incurred from an event which is necessarily and unavoidably postponed, abandoned, cancelled, curtailed or relocated in circumstances beyond your control. For artist managers, it can also protect commission income streams for high-earning performers.
Cyber Liability Insurance Your current insurance coverage may not protect against the special risks that accompany your activities into the online space. Cyber Liability cover can provide protection against the new risks that come with this continually developing technology.
Directors liability Increasing regulation is placing greater pressure on company directors & officers to perform meticulously. If a shareholder, employee or any other 3rd party thinks a director or officer has failed to exercise ‘due care’ in the running of a business claims can be made against them personally.
Safety planning for an event is outside the scope of this article but don’t forget:
Risk assessments for members of the public attending the event and employees working on it should always be carried out by a person deemed ‘competent’ under the requisite Regulations.
Being able to point to the existence of a risk management plan can be invaluable in the event of an unexpected incident. The plan may be a simple document incorporating a communication plan should an incident occur.
Conclusion
Don’t forget that your risk exposure starts as soon as you sign a contract with the venue to host the event. Consider all of your risks when in the planning stage and the contractual liabilities that you will be liable for if things don’t go according to plan. Accordingly, it is critical to regularly check the adequacy of your insurance coverage with your brokers. Ensure full descriptions of your actual and intended business everything are recorded in writing to your brokers and passed to your insurers so they can assess the risks and charge an appropriate premium that reflect the risks.
You should ensure you understand the nature and extent of the policy coverage, the policy exclusions and limitations such as whether legal advice cover is included for any enforcement authority investigation and /or prosecution before agreeing terms and paying the policy premium.
This article is only intended to provide a brief summary of some of the main insurances that organisers of an event should consider and discuss with their brokers.
