Festivals open doors for festive event insurance business

As the festive fervour has started gaining momentum with ensuing festivals like Ganesh Chaturthi, Navaratri and Durga Puja, event insurance providers have spotted a lucrative business prospects from the festivities. Bajaj Allianz General Insurance Company looks to cash on the festival events insurance this year.

The festival event insurance covers the organisers from any legal liabilities arising out of the cancellation of the event, non-appearance of artist or instances such as natural calamity or terrorism activities. It also secures the organisers from losses arising out of non-refundable advances paid for catering, venue etc. in case of event cancellation.

According to Sasikumar Adidamu, Chief Technical Officer, non-motor, Bajaj Allianz General Insurance, with festivals gaining popularity, the spend on the events has also increased significantly, thereby putting organisers at the risk of financial loss in case of cancellation of the event.

"The trend for insuring high-profile events or corporate events was a general trend. But recently, we are seeing more interest from festive event organisers to opt for insurance to safeguard themselves from the possible loss," Adidamu told BusinessLine .

Though at a nascent stage, the trend to insure festival insurance is gaining momentum with states like Gujarat, Maharashtra leading the lot. Bajaj Allianz received premium income of ₹2 crore last year, while so far this year the same has already reached ₹ 70 lakh.

For Bajaj Allianz, festival event insurance policies comprise of about 30 per cent of the total event insurance policies sold last year. The share is seen increasing at a rapid pace with more organisers opting for the cover.

"Last year (2015-16) we had sold total 190-200 event insurance policies, of which about 60 were towards festival events. This year (2016-17) so far, we have already sold total 50 policies. The number is likely to go up rapidly as we see increased interest from cities in Gujarat mainly for Navaratri and Ganesh Chaturthi," said Adidamu.

The average premium for an event size of about ₹10 crore would be anywhere between ₹3 lakh to 3.5 lakh. However, Adidamu explained that the premium calculation is done based on the risk assessment of the event and hence flexible.

The company conducts extensive risk assessment of the events with aspects such as location of the venue, season during which the event is being conducted, geological data, artist profile and his/her history, background check of the organisers apart from the liability assessment.

Last year about 6-7 claims were made to the company.

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