“The show must go on” sang the Briton Freddie Mercury. To come to the aid of an entertainment sector ravaged by successive lockdowns and health measures in the United Kingdom, London announced on Thursday an insurance program of more than 750 million pounds sterling (885 million euros).
In partnership with Lloyd’s, the fund will be used to cover the expenses of the organizers in the event of cancellation linked to a legal ban due to a pandemic, the Treasury explained. As part of this program, the government will thus play the role of reinsurer, providing its guarantee to insurers so that they can cover event organizers.
Many festivals canceled
A number of professionals including Munich Re, Arch, Beazley, Dale and Hiscox are supporting the project, according to the government. From next month, the organizers will therefore be able to take out cover, in addition to their standard insurance, until September 2022.
From big festivals like Glastonbury to concerts to fairs, a large number of events have had to be canceled since the start of 2021 in the UK. The British Association of Independent Festivals (AIF) estimates that a quarter of festivals with a capacity of at least 5,000 people have already been canceled this year.
Lack of visibility
The live performance sector represents over £ 70 billion a year for the UK economy and supports more than 700,000 jobs, the Treasury said.
In addition to health measures, it is above all the lack of specific insurance against the risks of cancellation linked to the pandemic that is proving to be a deterrent for the organizers. The summer seemed already badly started and they warned for months on the risk for the season 2022 to be also compromised, lack of visibility.
The insurance premium could rise to 5% of the amount likely to be compensated, in addition to the fees charged by the insurer, estimates the “Financial Times”.
On the other hand, the program should not cover cancellations of events related to the withdrawal of a principal artist sick with Covid-19, nor the reintroduction of social distancing during shows, which raises concerns about the limits of coverage.
I’m looking for 13 million euros in guarantees this fall to cover the costs of all my tours, but there are no Covid guarantees on the market right now.
Matthieu Drouot, Deputy CEO of Gérard Drouot Productions
The British Association of Independent Festivals nonetheless welcomed this announcement to the “Guardian”, while bitterly recalling that it had been campaigning for such a solution for more than a year.
In France, professionals at the net
In France, festival organizers were scalded last year because most insurers refused to take on the risk of cancellation linked to Covid. This summer, anticipating new difficulties, many preferred to skip their turn, or downsize like Les Vieilles Charrues or Jazz in Marciac.
“I’m looking for 13 million euros in guarantees this fall to cover the costs of all my tours,” explains Matthieu Drouot, deputy managing director of Gérard Drouot Productions, “but there are no Covid guarantees on the market at the moment. “States must take over otherwise the risks that we are asking producers to take are insane,” he said.
“Today each producer, each festival, has its own way of doing things, with its broker, its co-insurers,” explains concert producer Pierre-Alexandre Vertadier. The Covid will force us to rethink all of this ”.
A fund for festivals
“We should announce to our members in September the launch of a cancellation contract that we have negotiated for festivals, producers and venues,” reveals Malika Seguineau, general manager of Prodiss, the professional association in the sector. A long process with a call for tenders ”.
In the meantime, aid from the French state is being directed, via the National Music Center, towards a festival fund which compensates for the operating losses of the organizers, resulting from health constraints and gauge limitations, with aid capped at 400,000 euros. But today, when the gauges are restored to 100%, professionals are struggling to fill them. And there, the fund is not supposed to intervene …