How the COVID-19 Pandemic Affected Event Cancellation Insurance
The pandemic losses are affecting the ECI markets
When the COVID-19 pandemic arrived and precluded in-person events, many associations were able to quickly and successfully pivot to virtual meetings, delivering important content and, for a lucky few, generating meaningful revenue. However, the scale of lost revenue from pandemic cancellations in all sectors is well into the tens of billion dollars worldwide. Some experts estimate that insurance underwriting syndicates in the event cancellation market could give up profits earned over the last quarter century in paying out COVID-19 claims.
The pandemic losses are affecting the event cancellation insurance (ECI) markets in three ways that associations should be aware of: pending claims, premiums, and communicable disease coverage.
Pending Claims Take Longer
Given the scale of insured loss, some policyholders have expressed concern about whether insurers have the financial strength to pay claims at their full value. Despite the suddenness and scale of loss, there is no reason at this time to question the capacity of the markets to honor all financial obligations.
Please select this link to read the complete article from ASAE's Center for Association Leadership.