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Insurers rush to strip coronavirus from event-cancellation cover

Thu 13th February, 2020 12:40pm
LONDON, Feb 13 (Reuters) - Businesses looking to buy
cancellation insurance for events around the world will not be
able to get cover for the new coronavirus outbreak, industry
sources said, as insurers rush to exclude the epidemic from
their policies.
    The Shanghai Grand Prix and the Mobile World Congress in
Barcelona are among sporting events and major conferences
cancelled as a result of the virus, which has claimed over 1,300
lives, mainly in China.  urn:newsml:reuters.com:*:nL4N2AD2IK  urn:newsml:reuters.com:*:nL4N2AB22A  urn:newsml:reuters.com:*:nL4N2AA14A
 urn:newsml:reuters.com:*:nL8N2AC3R8
    Organisers of events which already have epidemic cover will
be able to claim for cancellation due to the coronavirus,
provided the event was due to take place in a country subject to
travel bans or limits on public gatherings, industry sources
say.
    Many businesses do not buy the extra epidemic cover, but
large events are more likely to have it, insurers say.
 urn:newsml:reuters.com:*:nL4N29Y1Y5
    But for those planning music, sporting or trade events now,
some of whom begin organising and buy the insurance up to two
years in advance, there will be no protection.
    “As things stand at the moment, you would struggle to get
coronavirus cover for any event, until we know where we are with
this virus,” said Rebecca Mitchell, contingency underwriter at
Argo Global.
    Even though not all organisers buy extra epidemic cover,
losses to cancellation insurers are already likely to be more
than $100 million, said Tim Thornhill, director, sales in
entertainment and sport at Lloyd's of London broker Tysers.
    Other events cancelled include the Hong Kong Art Basel fair,
which one underwriter said would prove costly for insurers due
to the high value of the art.  urn:newsml:reuters.com:*:nFWN2A616V
    Analysts at Jefferies estimate the insurance value of the
Shanghai Grand Prix at $500 million, though brokers and
underwriters told Reuters they expected losses to be lower. 
    The wording of insurance contracts is often nuanced, so it
could be hard to say whether cover was available or not, said
Edel Ryan, who is on the Special Risks team at broker Marsh JLT
Specialty.
    But "disinclination to travel" was never covered by
insurance, she added, so delegates or exhibitors who pull out of
conferences outside a directly affected region would not be
insured.
    Major insurers such as Zurich  ZURN.S  and Lloyd's of London
underwriter Hiscox  HSX.L  have said they do not expect a
significant financial impact from the virus so far.
 urn:newsml:reuters.com:*:nL8N2AD1F7 urn:newsml:reuters.com:*:nFWN2A50TQ
    But Argenta, which operates in the specialist Lloyd's of
London market, said in an online post this week that if large
events including the Tokyo Olympics were cancelled, "undoubtedly
a number of Lloyd’s syndicates would be impacted."

 (Reporting by Carolyn Cohn in London and Noor Zainab Hussain in
Bengaluru; Editing by Bernadette Baum)
 ((carolyn.cohn@thomsonreuters.com; 44 207 542 6320; Reuters
Messaging: carolyn.cohn.thomsonreuters.com@reuters.net))
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