The UK state-backed insurance coverage scheme designed to assist maintain the reside occasions sector going via the coronavirus pandemic paid out only one declare of £180,500, whereas producing virtually £6mn in premiums, based on official information.
The “reside occasions reinsurance scheme”, which was arrange in September 2021 and wound up a yr later, paid out to the organisers of an digital music pageant after it was cancelled as a result of the venue was wanted as a vaccination centre.
The main points had been printed by the Treasury in response to a freedom of knowledge request by the Monetary Occasions, which revealed the scheme collected £5.9mn premiums to cowl 169 occasions however obtained only one profitable declare.
The FOI didn’t embody the variety of unsuccessful claims however one insurance coverage dealer mentioned the design of the scheme meant it may very well be troublesome to get a payout. “They had been fairly hardline on the way in which that it labored,” he mentioned.
UK prime minister Rishi Sunak, when nonetheless chancellor, unveiled the reside occasions reinsurance scheme in August 2021 as pageant and occasions confronted a second summer time of uncertainty after the final Covid restrictions had been lifted solely weeks earlier in England. The product was designed to fill a gap out there after insurers had withdrawn cowl for Covid-related cancellations.
“With this new insurance coverage scheme, all the things from reside music in Margate to enterprise occasions in Birmingham can go forward with confidence,” Sunak mentioned on the time. The federal government, which acted because the “reinsurer” of final resort, promised it could additionally ship “worth for cash for taxpayers”. It was backed by a handful of insurers together with Lloyd’s of London corporations Beazley and Hiscox.
Main occasions equivalent to Wimbledon and the Brit Awards had been insured through the scheme however limitations of the quilt — which might not pay, for instance, for a cancellation on account of an artist or manufacturing employees catching Covid — decreased wider take-up.
The one payout was made to a promoter buying and selling as Terminal V for its occasion, Trick Scotland, the Treasury mentioned. Based on a discover on the time, Trick Scotland’s deliberate present in late December 2021 was cancelled because the Scottish authorities prolonged its vaccination marketing campaign at Edinburgh’s Royal Highland Centre. Terminal V didn’t reply to a request for remark.
The restricted take-up of the scheme, initially billed as a £750mn dedication by the federal government however later upped to £800mn, mirrored the problem of making an attempt to design a product a yr within the pandemic. Insurers had already moved to shed their publicity to pandemic-related claims and had been loath to take extra such threat again on their stability sheets.
Patrick Davison, underwriting director on the Lloyd’s Market Affiliation, which represents insurers, mentioned the scheme “took a hell of loads of work to get off the bottom . . . at a time when only a few had been keen to take a threat”.
The federal government mentioned the scheme had “performed a significant position in getting the reside occasions trade up and operating as soon as Covid restrictions had been eased” and that just about 3mn persons are estimated to have attended occasions supported by the scheme.