Special Event Insurance protects your business from liability during a business-hosted event.
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Any thriving business knows the perks of leveraging events to promote their services and products. In this digital age, special events like conferences, fairs, and seminars offer businesses the opportunity to connect with their customers and prospects in a more engaged and personalized way. However, by hosting such an event, a business opens itself up to a number of risks and variables outside of its control?—the kind that may come back to the company in the form of a lawsuit.
What is Special Event Insurance?
Special Event Insurance is a form of liability coverage that can protect a company in the case of bodily injury or property damage to third-parties during a special event hosted by the business. Based on your policy, in addition to property damage and bodily injury, special event insurance may also protect your investment in producing the event should an extraordinary situation arise.
Examples of situations that special event insurance may provide coverage for include:
- A guest slips and damages his arm at your conference
- An employee damages the venue at which you are hosting your event
- An attendee consumes too much alcohol at your event and injures people on his drive home
- A guest accidentally sets fire to a portion of the property
- You must cancel the event due to an unforeseen circumstance out of your control
Should I Buy Special Event Insurance?
Any astute business owner should definitely consider purchasing special event insurance. A few dollars now could mean the difference between potential thousands, if not millions, in losses. It is always best to protect yourself in the event of an unexpected accident.
As a business owner, you’re already familiar with the number of risks that constantly exist outside of your control. This risk can increase exponentially during special events, especially depending on the size, scope, and nature of the event. Special event insurance may come at a cost, but it is often a small price to pay for the protection of your business.
When planning a special event, consider all the variables that are outside of your control:
- Last minute vendor or venue cancellation
- Bodily harm to your guests at the event
- Bodily harm caused by your guests at the event
- Property damage to the venue caused by your guests
- Property damage to the venue caused by your employees
In many cases, the choice to purchase special event insurance may not be up to you. Depending on the size of your event, many venues will require you to purchase special event insurance.
When Should I Purchase Special Event Insurance?
You must purchase special event insurance prior to the event. In many cases, It is best to purchase coverage as soon as you can. Depending on the nature of your event, investing in the right type of special event insurance is critical in protecting your business from financial risk.
What is Covered by Special Event Insurance?
The amount of coverage offered will differ based on your policy. However, there are several facets of Special Event Insurance that you’ll want to consider in light of your event to determine the key components your Special Event Insurance policy needs to adequately protect your business and your investment:
1. Rental Coverage
This portion of the policy protects against any damage to items or equipment rented for the purpose of your event.
For example, your business is hosting an event and leased a few high-quality speakers. At the event, one of your attendees damages your rental speakers. Your rental coverage would protect your investment and cover the cost of any damage to rental properties, including your speakers.
2. Third-Party Property Coverage
This type of coverage covers the physical location where the special event takes place. Typically, you can only use third-party property coverage on properties that are not owned by you or your business.
For example, you are hosting a VIP dinner for your top clients and you rented a nice restaurant. However, at the event, one of your attendees causes damage to the property by breaking a very delicate mirror. The repair costs to replace this mirror would be covered by third-party property coverage.
3. Liquor Liability Coverage
One situation in which you should definitely purchase special event insurance is if you decide to serve and sell alcohol at your business event.For example, your company hosts an annual dinner for your valued customers. As a part of the evening’s itinerary, you included a happy hour cash bar where your guests can purchase alcoholic drinks.
One of the guests drinks too much, becomes severely inebriated, and starts a fight with one of your employees that results in bodily harm to both your guest and employee. You could be held liable for the outcome of this situation, solely because it occurred during the event your business hosted.
Your general liability insurance policy may not include Liquor Liability Coverage, so it is crucial to check with your insurer if you intend to serve or sell alcohol at your event.
4. Cancellation Coverage
As the name implies, this type of coverage protects your investment in a special event, in the case of any unexpected cancellations. This can include natural disasters, rain, sickness, or anything else that may force you to have to cancel your event.
5. Umbrella Liability
Some venues may require a higher amount of coverage than the limits traditionally offered. You can opt-in to purchase umbrella liability to increase the coverage of your special event insurance.
6. Vendors Coverage
This type of insurance covers any damage to the property of the venue by any of your contracted vendors.For example, you hired a lighting specialist to illuminate the conference room of your event. During the event, one of the lights topples over and makes a hole in the wall of the hotel where you are hosting the event. Vendors coverage would cover the cost of repairing the hole in the call caused by one of your contracted vendors.
What is Excluded from Special Event Coverage?
Of course, like any insurance policy, there are certain situations that are not covered by insurance. In the case of special event insurance, many policies will not cover events that are particularly dangerous in nature.
Some things that a typical special event policy may not cover are:
- Firearms, gun shows, events involving guns
- Sporting events
- Aerial maneuvers such as bungee jumping and skydiving
- Pyrotechnics (fireworks) or anything including an open fire
However, most of these situations only apply to special occasions and are not applicable to most business owners. So as long as you don’t plan to have a fire-breather or plan to skydive at your next corporate event, you should be in the clear.
What Should I Know Prior to Purchasing Special Event Coverage?
Before purchasing special event coverage, you will want to assess your event and how much protection you need to adequately protect your financial investments. For example, a 2-hour seminar may need less coverage than a weekend-long employee retreat you are hosting.
Additionally, ask your vendors and venues what requirements they have for insurance. Specific venues will have their own requirements for the type of insurance you’re required to carry in order to host an event at their space. You will need to adjust your search for special event coverage based on these restrictions.
Applying for Special Event Coverage
When you’ve made the decision to secure your financial investment, you will want to begin by applying for a special event coverage policy. Here are some of the things you can expect an insurer to ask you:
- Your name and the name of your business
- The type of event
- The expected number of guests in attendance
- The number and kind of vendors you are planning to contract
- The type of entertainment that will be present at the event
- The average age and demographics of your attendees
- Whether or not your venue and vendors have liability insurance
- Whether or not you will be serving alcohol at the event
- Any temporary structures you plan to use like stages, flooring, and tents
- Location and time of the event
- Name of the venue’s company, or the venue’s owner
In conclusion, it is always a wise choice to insure any financial investment that you make if possible. This is the case for special event coverage. Usually, the more successful your event is, the greater the likelihood there will be factors outside of your control. As a business owner, it is your responsibility to insure not only your company but also your attendees.
Event marketing can be a powerful way for any business owner to promote products and services, create and maintain clientele, and build brand awareness. Don’t let any possible and unforeseen circumstances derail you or your company from realizing the profits of your event.