By Carolyn Cohn
LONDON (Reuters) - Britain launched a government-backed reinsurance scheme totalling more than 750 million pounds ($1 billion) on Thursday to cover live events against cancellation risk due to the COVID-19 pandemic, after intense industry lobbying.
Insurers stripped coronavirus cover from event cancellation policies after the pandemic took hold last year, prompting top entertainment industry figures such as Andrew Lloyd-Webber to demand a government-backed scheme to enable events to go ahead.
Festivals, concerts and exhibitions have already suffered cancellations due to the lack of insurance during the pandemic, despite intensive efforts to limit the health risks for performers, events staff and ticket holders.
Music festival Womad cancelled its July 2021 event, citing the government’s unwillingness to provide insurance support.
The British government is now working with specialist insurance market Lloyd's of London to provide the scheme, the finance ministry said in a statement.
And events organisers will from September be able to buy extra insurance against cancellation due to government COVID-19 restrictions, alongside standard events insurance.
The insurance will be available from Lloyd's of London syndicates including Beazley, Hiscox (LON:HSX) and Munich Re, with the government acting as a reinsurer.
"With this new insurance scheme, everything from live music in Margate to business events in Birmingham can go ahead with confidence," British finance minister Rishi Sunak said.
Tim Thornhill, director of insurance broker Tysers, said the scheme was "the news that the events industry needed".
It follows a similar 500 million pound backstop for the film and television industry last year, which has supported 610 independent film and TV productions.
However, some industry sources said the new live events scheme was limited, as it covers government lockdowns but does not cover broader social distancing restrictions, or artists' or staff illness due to COVID-19.
Paul Reed, CEO of the Association of Independent Festivals, said it was "imperative" that the government continued to work with the industry to "ensure that organisers can plan with increased confidence for 2022".
($1 = 0.7179 pounds)