The event planning industry is currently worth $450 billion in the USA and is still expanding. Businesses are reliant on both physical and online events for bringing in new customers and keeping existing ones. Because of this, event planners are much in demand, people who can bring together all the different players in a major event and ensure that they are all coordinated with each other. Whilst the rewards of successful event planning are great, there are also considerable risks involved that organizers need to learn to manage and insure against.
When you’re planning an event, the risks listed below must all be taken into consideration:
Regulatory compliance: Check up on all the relevant federal, state, and local regulations and legal requirements and ensure that you are compliant with all of them, including obtaining the necessary permits and proving to the appropriate authority that you have sufficient insurance.
Partner with responsible vendors: At events you will have vendors on site responsible for providing refreshments, merchandising etc. Make sure that these are reputable traders and that you have a clear contract signed with them detailing their responsibilities and permissions. Make sure that all of your vendors have adequate insurance; if they don’t, you could end up facing legal action for damages caused by one of the vendors.
Budget carefully: If you take on the planning for an event, you also assume financial responsibility; financial losses suffered by your clients will potentially be your responsibility, wiping out your profits and potentially your business. Maintain clear accounts and have insurance and contingency plans in place for challenges that may arise.
Be safe and secure: Have robust safety and security plans in place and make sure that all parties involved are aware of them. Have them fully documented so that in the event of breaches of safety and security you can prove that you did your utmost to prevent them.
In addition to dealing with the above issues, you should also think about online security. If your event is subjected to a skilled cyber-attack, you could be facing losses running into hundreds of thousands of dollars. Make sure that your event is protected by hiring cyber security experts to set up your online presence, and take out insurance against cyber attacks. Even if your event is not an online one, you will probably have some online element such as requiring participants to sign up online; if hackers managed to get hold of your address list or participants’ credit card details, your liabilities could be huge.
Once you have undertaken a full risk assessment, you need to start thinking about the sort of insurance you’re going to need for your event. It’s quite likely that you will need a number of different forms of insurance and some insurance may be event specific, but the types are listed below are all essential.
Professional Liability insurance: Professional Liability insurance* protects you from claims raised due to unintentional mistakes made in the professional capacity. This may extend further than simply asking for refunds for services you have been unable to provide; companies rely on events to generate future income, and they may claim that your failure to provide the event you were contracted for has led to loss of that income for which you are liable.
General Liability insurance: General Liability insurance* can protect you against claim by an outside party regarding injury or damage to their property. In these instances, your policy will cover your legal expenses as well as your cost to replace or remedy the situation up to the limits of liability. This might encompass someone suffering physical injury because you have not planned properly for crowd control, damages to a venue in which the event is taking place, or damage or loss to attendees’ vehicles or other personal property that could have been prevented with better planning.
Cyber Liability insurance: If your event has online element, even if that is only attendees having to register online, you should have cyber liability insurance in place to protect you in case of data breaches. If hackers get into your system, you can be liable for high expenses in terms of informing all affected parties, recovering lost data, compensating financial losses arising from cyberbreaches, and defending breach of privacy lawsuits.
Special Event insurance: Special event insurance has much in common with General Liability insurance, but can be taken out just for the lifetime of your specific event. It may also comprise additional coverage which would include event cancellation insurance (covering your expenses if the event is cancelled due to events outside your control), host liquor liability (insuring you against damage done by an intoxicated guest), and special item coverage (coverage for items belonging to you or your company used in the event, for example PA systems, that would not usually be covered in a General Liability policy).
Commercial Property insurance: This can be useful extra insurance for both events and general working life, covering the hardware you need to run your business, for example laptops, cameras, cellphones etc. This sort of property is usually not covered in general liability insurance, which only covers damage or loss to the property of third parties.
*As with any insurance, coverage will be subject to the terms, conditions and exclusions contained in the policy wording. The information contained in this article is general only. Coverage for claims on the policy will be determined by the insurer, not BizInsure, and will depend on the specific facts and circumstances involved.