Cricket World Cup hit by rain can cost millions of insurers



File photo: Referees Richard Kettleborough, Richard Illingworth and Michael Gough inspect the lawn after the rain delayed the start of the World Cup match between Bangladesh and Sri Lanka at the Bristol County Ground in Bristol on June 11, 2019. game was abandoned later.
Image credit: AFP

London: Lost revenues from a record number of World Cup cricket matches in England and Wales could result in claims of several million pounds for each piece of abandoned equipment, insurance sources said.

Broadcasters, organizers, venues, advertising sponsors and food outlets are among the companies left out after four matches were canceled in an exceptionally rainy June month.

Due to the hectic nature of the tournament, which features 48 one-day games between May and July, ending on July 14, there is no chance of rescheduling except for the semifinals and finals.

Companies typically purchase contingency, or cancellation, insurance for sporting events, which covers everything from stale rain to terrorist attacks.

Lloyd & # 39; s, from London-based insurance company Beazley, estimated, for example, that the Football World Cup in Russia in 2018 was insured for more than $ 10 billion, including coverage for material damages and cyber-violations, as well as cancellation .

Insurers say coverage for the less popular cricket equivalent will be much lower.

Star India holds global media rights to the cricket tournament, but has licensed other rights to sports broadcasters in other countries.

However, it is likely that it has lost at least 1 million pounds ($ 1.26 million) for each abandoned game, according to insurance experts, who get huge advertising revenue in India for a popular sport in a country of more than one billion people.

Star India did not respond to requests for comments.

There are 123 advertising spots for broadcasters in a World Cup match, after each of the 100 overs and 20 wickets and at intervals, said Jonathan Ticehurst, director of insurance brokerage Lloyd's of London who made insurance for cricket .

Broadcasters buy contingency insurance, such as "in case they do not play, they are not able to charge" advertisers, he said.

The luminaires, several of which were sold, also attracted ticket sales of at least a few hundred thousand pounds each, with larger games probably attracting sales of more than a million pounds, based on Reuters estimates.

Viewers get all their money back if no ball is thrown, or if the game is abandoned after a small amount of play.

The England and Wales Cricket Board (ECB), which receives revenue from the sale of tickets, said it had an insurance policy against the games being canceled, but declined to comment further.

Star India probably made contingency insurance for Indian insurers, but reinsurance may have been provided by the Lloyd's of London specialist market, insurers said.

Reinsurers share the burden of large losses with insurers in exchange for part of the premium.

The ECB probably also bought insurance from the Lloyd's market, along with county teams whose land was reserved for accidental disputes, industry sources said.

Local teams will buy insurance against lost sales at local bars and restaurants, sources said.

But insurers may also require customers to withstand losses for one, two or even three abandoned games, experts said. In four rounds, you are likely to be able to claim insurance if not before.

"Insurers probably looked at the schedule and judged that you would not go through the World Cup without two or three games being canceled," one subscriber said.

"They'll probably charge an excess of two or three games." The four abandoned games were all in smaller venues. An abandoned game at a bigger stadium in London, Birmingham or Manchester during the remaining 3 ½ weeks of the tournament would have an even bigger financial impact, according to insurers.


Source link