Insurance Coverage Litigation
Vol. 34 No. 1
Published in Coverage Vol. 34 No. 1, Copyright © 2025, American Bar Association. All rights reserved. This information or any portion thereof
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Event Cancellation Insurance: Don’t Shake (the Issues) Off
By Latosha M. Ellis and Yosef Y. Itkin
In today’s unpredictable world, the need for event cancellation insurance has never been more
evident. Whether it is a high-profile concert by a global superstar like Taylor Swift or an
international sporting event like the Olympics, the potential for disruption looms large. Terrorism
and war, adverse weather events, and pandemics contribute to the growing risks faced by event
organizers, artists, and venues.
Despite the sparse case law addressing coverage issues in event cancellation policies, certain
issues have been teased out to some degree. Frequently disputed coverage issues include whether
certain exclusions apply, including the communicable disease exclusion and war exclusion; what
“losses” (e.g., expenses, profits) will be covered; and whether a cause of loss is beyond the
policyholder’s control.
Become Familiar with Event Cancellation Insurance Issues
Event cancellation insurance is a specialized type of coverage designed to protect against
financial losses when an event is canceled, postponed, or relocated1 due to unforeseen
circumstances beyond the policyholder’s control.2 It can cover a wide array of risks depending
on the type of policy. Many policies are written on an “all-risk” basis, whereas others are issued
on a specified perils basis. Depending on the terms of the policy, the insurance can protect
policyholders from unforeseeable circumstances, such as inclement weather, earthquakes, power
failures, non-appearances by performers, and terrorism. But a policy issued on a specified perils
basis, such as a virtual event cancellation policy, will offer more limited coverage based on
specified causes, such as the malfunction of necessary facilities (i.e., equipment vital for the
event to proceed virtually) or the non-appearance of a key speaker. Or a policy may specify
coverage only where the cause is the direct result of terrorism or loss arising out of adverse
weather events such as “Storm, Cyclone, Typhoon, Tempest, Hurricane, Tornado, Flood and
Inundation.”
But one thing is evident: As global events become more complex and fraught with potential
disruptions, the importance for insurance coverage practitioners to be familiar with the legal
issues pertaining to this coverage has become increasingly clear.
Increased Threats of Event Disruption Implicate Coverage Issues
There are many circumstances that could affect proceeding with an event. More recently, the
world has faced greater obstacles introduced by terrorism and war, adverse weather events, and a
pandemic, all causing event disruptions and each potentially implicating exclusions to coverage.
Terrorism and War
Application of the war exclusion. The cancellation of Taylor Swift’s concerts in Austria due to
terrorist threats highlights the dangers that high-profile events face.3 Particularly after the attacks
on September 11, 2001, event cancellation policies commonly include exclusions for terrorist
acts and war-related events.
