March 8, 2002

Organizer?s do-to list should include big check by special-event insurance

When organizing the Bolder Boulder, sponsoring a concert or planning a wedding, insurance is part of the event price.

But organizers should be aware that not everything is covered by liability insurance and should consider special insurance that covers a disruption or event cancellation.

The Bolder Boulder buys liability insurance to cover participants, volunteers, spectators and sponsors involved in the race, which runs about $40,000 a year, said Race Director Cliff Bosley. About 41,000 run or walk in the race and there are another 45,000 to 50,000 spectators of the Memorial Day event.

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“We secure special-event insurance,” Bosley said. “We don’t get what they call disruption or cancellation insurance.” Disruption and cancellation insurance would add another $45,000 to the race tab.

Instead of paying the insurance premium, Bosley said his organization pays money into a reserve fund that would cover a year when there might be a problem. If weather is a major problem, race organizers could postpone the race if necessary.

“We think the insurance companies are charging too much for those type of premiums,” he said. “I think it’s outrageous.”

The Bolder Boulder isn’t the only organization taking a hard look at special insurance covering disruption or cancellation.

“We always evaluate every show we are going to do,´ said Ron Aguiar, assistant director of risk management for the University of Colorado. “We have the option of special-event insurance.”

Despite studying the risks, Aguiar said CU hasn’t had to buy additional insurance. The university carries general liability insurance. Event promoters and organizers are asked to buy their own liability and special event insurance.

Taggart & Associates Inc. in Boulder is an insurance broker that finds insurance for people organizing an event.

“The traditional business putting on a special event generally buys liability insurance,´ said Doug Bollman, sales manager at Taggart. “Usually the promoters of an event will buy the insurance.”

A policy for a small event with fewer than 500 can cost $500 to $1,000, Bollman said. A minimum premium 10 years ago for the same event was around $250.

Bollman said more people planning a wedding are considering special insurance to cover stolen gifts, destroyed photos and people not being able to arrive.

“It’s become more and more requested because the cost (of weddings) has continued to increase,” he said.

People buying that special type of insurance don’t buy it from the place hosting the event. Bollman said insurance companies that offer event cancellation or liability insurance are often out of state.

According to Bloomberg News, insurers like Lloyd’s of London that have policies for large, high-profile national and international events, are boosting their rates to pay for an additional terrorism risk. Locally, event organizers say that isn’t an issue. But weather can be a factor.

Rick Rauch, co-founder of Boulder-based Event Design Group, said he has seen clients buy special weather insurance.

“It is bought by event planners or host organizations,” he said. “We typically get it to protect against weather. It can cause cancellation or very bad attendance.”

Event Design Group helps organize events like company meetings, picnics, grand openings and open houses. Rauch said if a company buys insurance to guard against snowfall, the premium depends on how much snow and over what time period.

At American Events & Promotions in Lafayette, clients aren’t charged for liability insurance. Susan Mesco, president of American Events, said insurance is an office expense that her company pays. The company plans a number of events including picnics, theme parties, team building, conferences, open houses and birthdays.

Mesco said hotels have insurance but some event planning companies also carry insurance. “It’s our job to alert them (clients) if they need special insurance,” she said. An example might be something above and beyond normal danger like someone doing fire dancing at an event.

When organizing the Bolder Boulder, sponsoring a concert or planning a wedding, insurance is part of the event price.

But organizers should be aware that not everything is covered by liability insurance and should consider special insurance that covers a disruption or event cancellation.

The Bolder Boulder buys liability insurance to cover participants, volunteers, spectators and sponsors involved in the race, which runs about $40,000 a year, said Race Director Cliff Bosley. About 41,000 run or walk in the race and there are another 45,000 to 50,000 spectators of the Memorial Day event.

“We secure special-event insurance,” Bosley said. “We don’t get what…

Christopher Wood
Christopher Wood is editor and publisher of BizWest, a regional business journal covering Boulder, Broomfield, Larimer and Weld counties. Wood co-founded the Northern Colorado Business Report in 1995 and served as publisher of the Boulder County Business Report until the two publications were merged to form BizWest in 2014. From 1990 to 1995, Wood served as reporter and managing editor of the Denver Business Journal. He is a Marine Corps veteran and a graduate of the University of Colorado Boulder. He has won numerous awards from the Colorado Press Association, Society of Professional Journalists and the Alliance of Area Business Publishers.
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