If you are hosting an event soon, you may ask “What is event insurance coverage?” You may also be wondering what an event insurance policy covers.
Put simply, event insurance is a common policy that protects you and your investment during a specific event or activity. It covers any costs involved if you must suddenly cancel due to unforeseen circumstances. It also protects you if someone suffers an injury during your event or if there is property damage for which you are held responsible.
In this post, we discuss everything you need to know.
What Are the Most Common Event Insurance Coverage Options?
As you look into the different kinds of event insurance, you’ll soon learn that there are two principal varieties: event liability coverage and event cancellation coverage. Here’s a close look at each.
1. Event Liability Coverage
Sometimes, the unexpected happens at an event. Someone may be injured during the event, or any other kind of accident may cause property damage. You will want to have one of these policies in place to protect you — it’s the best reason to get event liability coverage.
You should also know that if you’re booking a location for your event, many venues will require you to have an event liability coverage policy in place in case there’s a mishap. For instance, maybe the band you hired damages the stage while they’re setting up their equipment. This coverage will help pay for those repairs.
A guest’s actions might also warrant your insurance policy coming into play. Maybe an enthusiastic dancer at a wedding knocks over a server who is passing by with some drinks, and that server sprains their ankle. Your event liability insurance will likely cover their medical bills.
You should also know that, as with any insurance policy, a coverage limit exists. Also, while your policy should cover any equipment you rented from the venue, equipment belonging to a third-party business not associated with the venue will likely not be covered if it is damaged. You’ll want to read through your policy carefully to make sure you understand everything that is and isn’t covered before the event begins.
2. Event Cancellation Insurance
The question of “what event insurance is” can’t be answered without explaining event cancellation policies as well. This is a separate policy from event liability coverage, though there are companies that will be happy to provide you with both.
Event cancellation coverage is in place to reimburse you for some or all of your financial outlay if you must cancel due to unforeseen circumstances. Understand, though, that you will only be reimbursed up to the policy’s specified coverage limit.
Maybe you booked an outdoor venue, and severe weather makes it unusable on the day you picked. Perhaps you have a situation where the photographer you hired can’t make it to the event, and you’ll need additional funds to hire a new one on short notice.
Your event cancellation policy can probably help you in both of those scenarios. In short, if you need to reschedule or hire new vendors, caterers, or photographers, the money from your event cancellation policy will be there for you. You can also use it if you must schedule a new venue on short or even last-minute notice.
As with event liability coverage, you should check your policy’s details before paying for it. You can always ask the provider questions before signing anything. They will be happy to clarify any details you may not understand.
3. An Optional Clause: Gifts and Attire for Weddings
Weddings are among the most common situations for which you might want event insurance. Often, though, the standard liability policies for weddings stipulate that items like tuxedos, gifts, wedding dresses, and similar items are not covered.
If you want these items covered, too, an optional add-on coverage clause can be added to your policy—just ask your insurance provider.
What Types of Events Are Covered?
You might host several functions or gatherings where it makes sense to purchase an event insurance policy.
They include:
- Religious celebrations
- Weddings
- Anniversary parties
- Birthday parties, including Quinceañeras
- Baby showers
- Gender reveal parties
What Types Are Not Covered By a Standard Policy?
Some events are generally exempt from event insurance. Sometimes, you can tell which ones are ineligible by differentiating between public and private functions of which you are the host.
Public events that are not covered might include:
- Sporting events
- Exhibitions
- Dance recitals
- Bachelorette or bachelor parties
- Haunted houses
- Activist or political events, such as rallies or protests
- Hot air balloon, boating, or aircraft events
Some corporate events might not be eligible for this type of insurance either. In some instances, you may not be able to get a policy for a private corporate party or a fundraiser. You must talk to an insurance provider and explain the details of one of these events to them to find out whether it is eligible for event insurance coverage.
At What Point in the Planning Process Should I Purchase Insurance?
Let’s say you plan to host one of the events mentioned above, for which you would typically purchase event insurance. Ideally, getting a price quote on a policy and moving forward with it should happen when you book the venue or start making other event-related purchases.
At this point, you want to start implementing safeguards. You can always put off buying a policy at this juncture. However, that leaves you open to financial risks that you are best off avoiding.
Do I Really Need It?
To some, parting with the money to pay for coverage may seem like a wasteful expense or an unnecessary cost.
You should know, though, that many venues you would consider using for a wedding or a graduation party won’t let you book them without an event insurance policy that covers you for a specific dollar amount. Even if you didn’t want to pay for such a policy, you would have to if you wanted to book that particular venue or many of the existing alternatives.
Also, even if you’re lucky enough to find a venue that’s more lax about its rules in this regard, it could be an unmitigated disaster if a server gets hurt, a guest causes some damage, or something else that’s unexpected happens, especially if you can be held liable for it. Without an insurance policy protecting you, you leave yourself open to a lawsuit. The results could be a lot more costly than the price of an event insurance policy.
Additional Event Insurance Coverage Details You Should Know
No answer to the question of “What is event insurance coverage?” would be complete without a brief rundown of some additional details on this topic.
You need to choose an insurer that is licensed in your state. Finding a company with a policy in your price range won’t do you much good if that policy is not applicable in the state in which you’re hosting the event.
You can also ask any performers or companies that will perform a function at your event, such as the caterers or the band, whether they carry liability insurance. You probably can’t use theirs as a substitute for purchasing your own policy, but any additional insurance should always make you feel better about your activity, even if it’s redundant.
Finally, you may have additional insurance coverage available through the credit card you use to book the venue. It’s not a suitable substitute for event insurance, but it can sometimes serve as an extra layer of protection.
Now that you have a better idea of what event insurance is, what it covers, and why you need it if you’re planning a large party or social gathering, you can find a policy that suits your specific needs. Contact ESP Speciality to learn more about the events we cover or get a quote today.
