If you run a wedding or event venue, it is becoming more common place to make event liability insurance (also known as special event insurance) mandatory for the renter. Over 80% of venues now do and for good reason. A separate special event insurance policy can shield your venue’s main policy from claims and premium increases (in some cases can even reduce your premiums). Having your venue’s policy take on the risks of renters/hosts could lead to a lot more stress when a claim is filed.
All this said, below is a list of best practices when it comes to special event insurance:
1. Ensure Policy Authenticity
A scam that happens all too often is where:
- A renter purchases an event insurance policy to show the venue they acquired the insurance, but then cancel afterwards (and get a refund) without the knowledge of the venue
- The renter finds a certificate of insurance online and manipulates it using software like Adobe Acrobat to make it look like they purchased a policy
To fight against this, insurers have started to introduce measure where they:
- Automatically notify the venue when a policy is cancelled
- Include a unique policy authenticator QR code on the policy certificate that, when scanned, will show the venue whether the policy is real/active or not.
2. Policy Limits & Endorsements
Best practices for policy limits include:
- Minimum liability limit of $1M occurrence and $2M aggregate
- Minimum damage to rented premises of $250,000
- Minimum medical expense limit of $5,000
- Automatic inclusion of host liquor liability
- Automatic inclusion of Waiver of Subrogation and Primary Noncontributory endorsements
3. Additional Insureds
Venues should always be listed as an additional insured on the policy certificate, and use their formal name. Include all related entities such as property owners, holding companies, etc.
4. Policy Automation
Many insurers now allow venues to preload their requirements at no cost. In return, the venue gets a unique link that will automatically apply the required limits and additional insureds to the policy. It will also email the venue each time a policy is purchased and, as mentioned above, the insurer will also email the venue if the policy is cancelled so the venue can act appropriately.
Overall, the policy automation feature can save a venue manager anywhere from 3 to 8 hours a week in follow ups and admin work.