Festival organisers need easy access to expert insurance advice as they juggle conflicting priorities and face a range of risks that would turn many grey-haired. In this article we look at what kind of insurance festivals need to buy, and provide a handy Risk Checklist for the Festival Season.
Partners& works with festivals to help them build financial resilience through our specialist advice and bespoke insurance programmes for the performing arts. We’ve insured everything from a 60ft inflatable octopus to hot coal walking for the public and a £250,000 chandelier.
Why do festivals need specialist insurance? 3 good reasons:
1. Premium calculation
Insurance premiums are calculated from statistics and historical data. Many general insurers have fixed (and inaccurate) ideas about the industry, and their high rates reflect this. A specialist festival insurance broker will understand the risks more deeply and have access to appropriate policies on fair terms.
A policy is a legal contract, with an all-important “definitions” section. Your definition of words like “contents”, “employee” and “business hours” may differ considerably from what your insurer had in mind. Your office may house merchandise/programmes or specialist equipment – and if you use self-employed or short-term contract freelancers (event managers, stewards), this will affect the definition of “employee” in your policy.
3. Deadlines & risk exposure
Many performing arts risks are time-critical. Your festival insurer needs to be aware of the potential knock-on costs of, for example, a fire at the programme printers. Venue and equipment hire contracts contain many conditions that extend your obligations for injury and damage.
What insurance do festivals need?
Festivals need a range of specific insurance types or ‘lines’– with each fine-tuned at the right level of cover for their specific risks. Make sure you consider the following in your festival insurance portfolio:
- Property insurance: for office contents, computers, musical instruments, hired in equipment, marquees, tents, audio and visual equipment and plant, merchandise stock, CDs, brochures, programmes.
- Business interruption insurance: protects income streams during physical and technological disruptions to your festival (fire, flood, power & telecommunications failure, prevention of access to venues).
- Festival volunteers: programme sellers, drinks servers, car-park attendants – if volunteers are involved in your event, you need employers’ liability cover. All the goodwill in the world won’t compensate a debilitating injury.
- Employees: freelance contractors, tour managers, stewards – even temporary, fee-paid workers need to be insured as festival employees. And if you have more than five employees, the law requires that you have a health and safety policy. Without this, insurance will be hard to secure.
- The public: festival audiences, local residents, artists, venues – everybody knows public liability is a must, but make sure you are covered not only for injury to audience and/or performers, but also damage to property and particularly venues. Compliance with the Data Protection Act also comes under public liability.
- Products: food, drink, festival merchandise – if something tangible that you provide causes injury or illness, you will be exposed to litigation.
- Trustee liability cover for committees and festival board members. Did you know your long-suffering trustees are personally liable for financial loss, poor administration (including inadequate insurance) of the event, tax errors, dishonesty of an employee, breach of confidentiality, breach of copyright?
- Hired in equipment: PA, staging, fencing, radios, marquees, toilets, generators – your hire contract probably makes you responsible for insuring equipment you have hired. Not only does this mean you must replace any lost/damaged equipment but also you are almost certainly liable for the continued hire charges until the item is replaced – this could take weeks and be very costly.
- Stock: festival programmes, brochures, merchandise, food & drink – the associated potential income may be important to your budget projections, not to mention to your audience’s experience of the event. Not only do you need to consider replacing the stock but also the opportunity cost if the stock is not there to sell. Is your stock covered when away from your office and after 5pm?
- Cash/money: door sales, bar takings, festival merchandise, subsistence monies, artist fees – even if most box office sales are made in advance, large sums of cash are inevitably around at public events, from walk-up ticket sales, programmes, cash bar takings, to artist fees you are contracted to pay on the night. In a busy front-of-house environment, or in transit, anything could happen…
- Event cancellation: artists do cancel. The venue could burn down, your outdoor event might be flooded – and transport delays are a constant threat, caused by bad weather, mechanical breakdown or strike. But you can protect income that depends on the event going ahead – or even just cover specific costs such as venue hire, artist accommodation and marketing. Cancellation and non-appearance insurance can be specifically tailored to your needs.
Risk Checklist for the Festival Season:
- Consider your contractual terms with subcontractors (staging, lighting, catering) – is your own and their insurance cover adequate?
- Check your terms with hired festival venues: you may be liable even if property damage is not through your negligence.
- Carry out risk assessments in order to identify and quantify your own risk exposures. Demonstrating risk management competence to potential insurers often yields rewards in securing improved premiums, especially for public and employers’ liabilities.
- Develop your festival’s health and safety and risk management procedures: without basic practices in place, you may not even get cover.
- Don’t pay twice: having several policies for office, liability, cancellation etc. may involve duplication of covers, extra cost and wastage.
- Festival programmes/merchandise: make sure they are included within the property sum insured.
- Loss of income: you can insure against, for example, loss of or damage to programmes too late to re-print/re-supply before the end of the festival.
- Trustee liability insurance is moving up the agenda in arts boardrooms throughout the country. Trustees are responsible for corporate governance just as are directors of any corporation. Significant strategic decisions (such as diversification to different art-forms) may expose trustees to allegations of mismanagement. Protect them!
- Consider event cancellation insurance*: if an artist cancellation, venue fire or flood, or transport delays (bad weather, mechanical breakdown or strike) could mean the abandonment of your festival or event, you can protect income or even just cover specific costs such as venue hire, artist accommodation and marketing.
- If you’re streaming festival performances, particularly to a paying audience, work through the risks. Ask about insurance against virtual transmission failure, to cover cyber incidents relating to computer systems and infrastructure (internet services, gas, water etc).
*Cancellation insurance and Covid-19
Although there is still no cover available for cancellation as a result of coronavirus, public liability insurance may respond in situations where the illness was allegedly contracted at your event as a result of your alleged negligence. Clearly you will need to have updated your risk assessments and health and safety policy specifically addressing Covid.
For advice on keeping your festival financially resilient, contact Mark Boon, Executive Director, Partners&