How to Succeed in the Entertainment Insurance Business: Get creative producing with a small cast of underwriters and limited capacity.

By | May 20, 2024

Even during the post-pandemic boom in the entertainment industry, when event and live performance venue attendance reached pre-COVID-19 levels, insurance markets in the sector could be difficult.

Now, the post-pandemic momentum may be slowing as entertainment businesses contend with rising costs of doing business, staffing shortages, and an insurance market that remains somewhat restrictive and more expensive.

The entertainment insurance market features a small cast of experienced underwriters with reduced appetite and limited capacity – much as it did a year ago. Just as the entertainment businesses must get creative to find talent and sell tickets, the insurance market requires agents to get creative to find the coverages and limits that their clients need and can afford.

“Coming out of Covid, there was a really big surge in activity in year one and two, which was super exciting for us,” said Mona Grabowski, vice president – entertainment at HUB International, which specializes in music festivals, live events, and touring. “This year has been tougher.”

The biggest concern for music festival and live event clients is finding qualified talent to run the show. “I think a lot of people didn’t come back from Covid in terms of production teams so I think having the bodies to make events happen has been a challenge,” she said.

Costs are up overall and at times production equipment for live events can be hard to come by, she added.

“Obviously cost is a big concern,” Grabowski said. “Prices are up for everything.” Some of her large music festival clients say expenses overall are 25% to 30% more than before the pandemic. “It’s just been a lot, and then we’ve seen insurance rates spiking each year. This year, we’re seeing about a 15% increase on liability across the board,” she said.

After years of growth, some music festivals are shutting their doors. At least 10 shows in the U.S. have been canceled this year, according to recent report by Bloomberg. More budget-conscious consumers are a factor, but so are rising costs for staffing, stages and the performers.

According to Scott Carroll, underwriter/broker, Take1 Insurance, a division of U.S. Risk, new event productions have slowed the most but the live event market overall remains vibrant.

“We still see a lot of interest and activity but certainly on the live side [of entertainment], we see still a significant slowdown in new clients,” Carroll said. He said this includes any business with a live audience component, including conventions.

For Carroll, whose book includes about 90% live entertainment, new clients were coming into the space every week prior to the pandemic. But new client activity has slowed dramatically, he said. “So we might be seeing a few a month now where we probably were seeing north of 25 a week, and I find that to be directly related to the pandemic.”

Carroll agrees risings costs are the culprit. “They’re looking at it through a much more critical lens of the investment required to carry the equipment, to rent space, to house the equipment … And they’re doing the projections and saying there’s not enough for me to jump into this space like before.”

Underwriting Changes in Live Events

When it comes to insuring live events, legacy insurance companies continue to be active in entertainment but have cut back their appetite, Grabowski says. “Most of my markets are so niche – I haven’t seen any of my live event markets exit the space – but they have sort of tightened their belt on capacity,” she said.

Catastrophic events at large music festivals in recent years, such as the 2021 Astroworld festival where 10 people were killed in a crowd surge, make carriers nervous, Grabowski added. Those types of tragedies “reverberate” throughout the niche insurance market, and “so everybody revisits the ways in which they’re underwriting,” she said.

“Thankfully,” she said, her markets have not pulled up stakes, but she would like to see more markets come into the space “because it’s very limited, and that is a challenge that we face as brokers in this space.”

Carroll agreed that the main insurance players in live events are still interested and while appetites remain “fairly broad” there has been some tightening in certain areas.

“There’s a lot of limits reduction so carriers do not want to write $10 million limits anymore,” he said. “They want to write $5 million and, in many cases, they’re cutting back even further for touring entertainers, shell corps, some live events, and service firms.”

For example, a carrier might offer $1 million/$2 million occurrence in aggregate, and then might give a $1 million or $2 million in excess liability,

Carroll said. “So then we can go to the excess market to fill out a $5 million additional excess layer, or a $10 million layer,” he added. “We’re having to do more layering now, which is certainly an indicator that the markets are not putting too many eggs in one basket like they were willing to do before.”

Carroll added that aside from reduced limits some carriers max out on the number of events they are willing to take on. They might say, “We’re doing 10 festivals this year,” he added. “We’re not doing more than 10, or we’re not doing more than two a month, whatever their scenario might be,” he said. “That has changed the festival space a little bit.”

Today’s underwriting tightening has made it difficult in a small niche space like music festivals, Grabowski said.

“The markets that used to put up $10 million in excess are no longer offering that, or will only offer very limited capacity,” she said. Rates have gone up dramatically and adding in additional layers from additional carriers is always a challenge. “That has created some issues for us and I think pricing too also becomes a limitation in capacity for the festival themselves,” she added. “What can they afford to buy? Whereas $10 million might’ve been what they would’ve spent five years ago but now they are having to buy $5 million this year because that’s their budget. It’s been very difficult.”

Carroll says that while some festival organizers are cutting back, he’s seen expansion in events that offer a series model.

“We’ve actually seen an increase in scheduling of a series of festivals. So, in other words, it’s not just one festival, but it’s a series of festivals that starts with one so they build the concept and then they take that from city to city to city,” he said. “That’s a new concept that I haven’t seen before,” he added.

From an insurance carrier perspective that’s a positive, he said. “We were able to get more attention on that concept than we have been able to get on a single festival because there is an outline of how that festival works. The template is the same – same security firm, same concessionaire, the same everything.”

Another area of growth in live events is immersive entertainment, Carroll added. “That space is big right now, things like the Van Gogh Exhibit, where you are part of the experience.”

Grabowski is also seeing more activity with interactive festivals and festivals with a mission.

“Last year I was able to work with a few festivals that had a really great mission – one was on mental health and another was on heart disease,” she said. “I love having a mission behind a music festival so I hope to see more of that.”

Safety, Emerging Risks

Safety is one of the biggest concerns when insuring festivals – whether it’s extreme weather, active shooter preparedness, security, crowd surge, or the safety of artists, festival attendees and staff.

“What’s important as a broker is to make sure that when you’re partnering with a music festival that you start from the ground up,” Grabowski said. “I’m looking at their event safety plan, I’m making sure that it covers all aspects of risk transfer. We’re talking about making sure that every vendor that steps on site has an insurance policy in place and has adequate limits, making sure that whoever’s providing the liquor liability has adequate limits and they’re protecting the promoter.

“I’ve worked with many festivals, startup festivals and some very experienced that have never gone through that process with a broker. It’s really important that they understand the scope of their exposure.”

The biggest concerns today in terms of safety are security, active shooter risk, extreme weather, and now crowd surge, she added.

“Weather is always a massive concern, especially with outdoor festivals,” she said. “How are they tracking? Are they using a professional service tracking company to work with them to make sure that they’re tracking appropriately? Are they working with the best vendors out there, the best staging and rigging out there to make sure that their stage isn’t going to go anywhere in high winds?” she said.

Carroll added that political risk coverage has been more in the conversation than it’s ever been in entertainment. “There is a concern that there could be, by virtue of an artist, some kind of a connection to a political issue – that didn’t exist before,” he said. “We didn’t really think about it before.”

“When you bring up the subject of terrorism, it quickly morphs into active assailant. Everybody sort of draws the conclusion of active assailant, which is a far greater issue,” Carroll said. “But I do believe that exposure is a very substantial exposure that has changed.”

Two concerts by an American Jewish artist, Matisyahu, famous for his peace anthem song titled, One Day, were cancelled in February after pro-Palestinian protesters targeted venues where he was set to perform. Both venues cited staffing safety concerns after being targeted by protesters.

“The most important thing for us is that they’re having a safe event,” Grabowski said. “We don’t want any claims, but beyond that, we don’t want any injuries and we want everybody to go and have a wonderful experience and go home that night and be safe.”


Grabowski says one of the more challenging aspects of writing entertainment risks today is finding underwriters that understand the entertainment market.

“I would love to see underwriters more knowledgeable in this space,” she said. “Working with an underwriter that’s not comfortable underwriting a large music festival, creates a lot of challenges for us as a broker, so I would like to see definitely more talent behind the scenes on the underwriting side for sure.”

John Hamby, senior managing director, national entertainment practice leader, Risk Strategies/DeWitt Stern, agrees.

“There’s fewer experienced underwriters and it is just so time consuming to get answers and quotes out of many of the carriers these days,” Hamby said. “I would love to see that change – that’s simply going to require an investment from the underwriting community to staff up and enhance their staff.”

Given today’s shrinking underwriter talent pool, Hamby doesn’t see that changing anytime soon. “We’ve seen a lot of movement from underwriters just getting out of the business, and there’s not people to replace those leaving, especially in the entertainment space.”

Carroll hopes for a more aligned industry where venues find an insurance market in tune with their liability needs.

“There seems to me to be a miss between what venues are seeking in terms of limits needed versus where the market is – it used to be that both were right in line,” Carroll said. “A venue wanted $10 million of protection. Carriers were willing to provide $10 million of protection. If it got beyond $10 million, they wanted you to go to the excess market. What we’re now seeing is venues still want $10 million, but the insurance industry wants to only give $5 million or less.”

That creates a great deal of difficulty in filling that need for the venue, he added. “I’d like to see both come to parity.”

Social inflation trends are challenging the live events space, he added. “I think this is true of many industries, of course, but certainly in the entertainment space it’s challenging our industry because our carriers are pulling back and some excess carriers have left the space,” he said.

“We’ve got to get back to the point where there is more of a balance so more carriers come into the space.”

Topics New Markets Underwriting

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