Pressure mounts on government to underwrite live events

Boomtown
Boomtown

Broker-led group pushes for more support as March deadline for festivals to get insurance looms.

A host of famous musicians have joined calls for the government to underwrite cancellation costs for live events such as music festivals and tours to enable the restart of the live entertainment sector from this summer.

Alongside industry experts and trade associations, Jools Holland, Depeche Mode, Johnny Marr, Sir Cliff Richard, Robert Plant, Roger Daltrey, Amy McDonald, The Chemical Brothers, Frank Turner and Judas Priest have all added their name to the chorus of voices calling for a government-backed scheme. 

The industry, alongside brokers, has already begun the process of working with the UK government to get a £200m events insurance package in place.

Insurance Age understands it is hoped that there will be engagement from the government with an expectation that a meeting may take place in the next fortnight. There are also indications that Lloyd’s insurers could also attend any meeting in order to share expertise on how any scheme could be structured even if the market is unable to initially share the risk following large contingency losses in 2020.

Roadmap
A series of events were announced and tickets went on sale following the government’s publication of its ‘roadmap’ out of Covid restrictions last month.

However the insurance situation has not changed. Insurance for Covid-related cancellation is still not available and without this many of the events announced recently will not be able to go ahead and they must commit to event suppliers in short order.

Tim Thornhill, director of Tysers Entertainment and Sport Division and live entertainment insurance industry veterans Bob Taylor and John Silcock, are working closely with live music industry umbrella organisation LIVE and insurance colleagues to urge the government to work with industry to find a solution. 

Talks
Thornhill noted: “We have had a number of conversations with the government, but the momentum is not at the pace that it needs to be to allow some safe events to take place this summer.”

He pointed out that the film industry has already got a £500m government insurance scheme in place and warned if the same isn’t done for live events the chance of anything taking place over the summer is slim.

Thornhill commented: “The government has successfully created a scheme that has enabled the film and television industries to get back to work. Now they need to do the same for the live events industry. But the window of opportunity for this summer will slam shut very shortly. The government needs to act now. 

“The live events industry is a massive employer and a significant generator of economic activity. Music alone employs over 200,000 people, with music tourism contributing £4.7bn to the UK economy.”

Boomtown
Anna Wade, communications and strategy director for Boomtown, a 60,000 capacity festival which is usually held near Winchester in mid-August, told Insurance Age there was not currently any insurance protection for festival cancellation due to Covid.

Boomtown put tickets on sale last October as normal in the hope that 2021 would be more stable than 2020. Wade explained: “We went through the usual event process. We haven’t made any announcement to say we’re definitely going ahead but we saw last week that ticket sales were going crazy after the government announced its roadmap.”

According to Wade the majority of festivals will require insurance in place by the end of March. If a scheme is not in place by then they simply cannot go ahead.

She added: “A workable government-backed scheme would inject confidence.

“It is the key to us being able to re-open.”

Delays
Wade remarked it would have been helpful if conversations about a potential scheme had started to happen back in January this year when the DCMS Select Committee highlighted the problem.

She noted: “To still be talking two months later, that is frustrating. We are still waiting for crucial pieces.

“A lot of the industry needs to know by the end of March and the sooner the better.”

In December MP Jamie Stone backed an early day motion calling on the insurance space to underwrite event contingency.

Appetite
Thornhill highlighted that a recent survey by YouGov shows that consumer appetite for live events is strong.

He added: “The new YouGov survey shows that demand is there – they will buy tickets and spend on accommodation, food and drink. The government can unlock this boost to the economy at no cost to themselves, just a commitment to help underwrite the cost of cancellations should they occur.” 

Greg Parmley, CEO of LIVE added: “Governments in Germany, Austria, Norway, the Netherlands and elsewhere are already backing schemes to allow production companies and their staff to plan for a safe return to live events. The UK rollout of the vaccine is cause for optimism in creating events that are safe but the industry will be significantly hampered without COVID event cancellation insurance.” 

The industry’s call for action supports the letter to Rishi Sunak, Chancellor of the Exchequer, from Julian Knight, chair of the DCMS Select Committee, which warned that festival organisers and investors are unable to risk repeating losses sustained in 2020, unless the cost of events can be insured against cancellation.

Sir Cliff Richard commented: “Our business brings inspiration and happiness into people’s lives. We can make them smile when they are sad and help them sing when they have nothing to sing about. We need the government to help us plan for when it is safe to resume.”

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