Covid-19 excluded from risk cover for IPL

All stakeholders affected by the postponement of the Indian Premier League, from the sponsors to the organisers, are unlikely to get any relief through insurance claims as the Covid-19 pandemic is excluded from the risk covers.

According to insurance industry sources, the abrupt end to the IPL amidst reported Covid infections amongst players and support staff, would not translate into any insurance claims being paid.

The total risk across the 16 games is estimated at about ₹5,000 crore, amounting to about ₹80 crore to ₹90 crore per match. “Almost 90 per cent in terms of the value of the insurance across all these stakeholders is at risk,” Aatur Thakkar, Co-Founder and Director, Alliance Insurance Brokers.

“Comprehensive sports insurance cover like event cancellation insurance, players' loss of fee insurance usually come under the gamut of sports insurance. League organisers, television broadcasters, franchisees, sponsors, are some of the stakeholders in the event that have a huge stake which will be impacted in case of an uncertain eventuality of an event being impacted,” Thakkar said.

The Board of of Control for Cricket in India (BCCI), the broadcaster – STAR India, the sponsors and the teams purchase their own insurance covers. Gate money was not involved this year as there were no spectators in the stadium.

Claims under the policies are usually triggered if matches are cancelled due to events like a natural catastrophe, riots, civil commotion or act of terrorism.

State-run New India Assurance and National Insurance are understood to have exposure to a large part of the policies, while some private sector general insurers also have some exposure.“The BCCI generally buys insurance cover for a catastrophic risk, which can lead to the cancellation of the event. Once the tournament begins, then the respective stakeholders based on their exposure buy their own policies,” noted an insurance executive.

Since the outbreak of the pandemic, or communicable disease that is Covid-19, had started before the IPL in UAE last year, none of the insurance policies cover this exposure he said. “It is an absolute exclusion,” he explained, adding that no one would insure when an outbreak was already happening.“The press release is worded to say that it has been postponed due to the health and safety of players. But Covid is the underlying cause for this. Under this circumstance, none of the policies will respond,” he further said, adding that since the IPL has been postponed midway and if re-started at a later date, then the stakeholders would ask the insurers for an extension.

Depending on the location and timing, the insurance company may choose to extend the policies. “The Indian Premier League Governing Council (IPL GC) and BCCI in an emergency meeting has unanimously decided to postpone IPL 2021 season, with immediate effect,” said a statement on May 4.

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