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Football World Cup 2018: How insurers help the show go on

Staging a major sports competition, such as the 2018 FIFA World Cup in Russia can involve many risks for everyone involved, whether this is the World Football association, FIFA, organizers from the host country Russia, sponsors and broadcasters around the world or, last but not least, the football players and the fans. Entertainment insurers like Allianz Global Corporate & Specialty (AGCS) help to rectify any mishaps, so that the "Greatest Show On Earth" continues as planned. Read more:


"Every sporting event involves a number of risks. These can be large or small, expected or unexpected. There is only one certainty: No one could handle these multiple risks on their own," explains Michael Furtschegger, Head of Entertainment International at AGCS. "Without insurance, there would be no World Cup, no Olympics and probably no organized competitive sport at all."

Fortunately, a FIFA World Cup competition has never been interrupted so far. If, however, the opening ceremony or the final were to be delayed by just a couple of minutes due to a simple power failure or transmission error, advertising slots on TV channels would be cancelled, bringing in losses worldwide. In addition to technical failure, weather events, natural disasters, epidemics or terrorist attacks  could also cause a major sporting event to be postponed, or in the worst case scenario, cancelled.

“For Russia, hooliganism and terrorism are key risks, while the Zika virus was the major threat in Brazil four years ago,” Furtschegger says. Travel and health risks for individuals are common too, causing potential liability claims for the event hosts. For example, a hooligan could hurt a spectator, a fan could suffer injury from poor safety precautions or a player could face the end of their professional football career because of a foul.

The insurance industry offers comprehensive protection for all eventualities of a mega sporting event – from the construction of stadiums to the financial losses of organizers and sponsors to the personal health and travel risks of fans or players. For the World Cup 2010, which was held in South Africa, Lloyd’s estimated the insurance value at around 9 billion US dollars, including 4.8 billion US dollars for stadiums and training facilities alone. "These sums of insurance are likely to be exceeded in Russia this year, given the high level of investment," estimates Furtschegger. According to reports, Russia’s confirmed spending on the World Cup totals around $12 billion, which does not even include construction and renovation costs for stadiums and infrastructure.

Covering property and liability risks for a major sporting event is standard.  On top of this bespoke insurance solutions are also available for the specific requirements of companies that are directly or indirectly involved in the World Cup.  These include, for example “Prize-Indemnity" or "Over- Redemption" policies which can cover financial expenses after unexpected sporting successes. For example, an electronic retailer would have to shoulder high costs if it has linked a financial discount or refund promotion to the victory of the national team and then this actually happens. Even national teams use financial buffers for contractually-agreed bonus payments to players. "In the surprise event that a team such as Nigeria makes it to the final, there would probably be high bonuses due to the players that could exceed the financial capabilities of the national football organization. Here individual insurance solutions are possible," explains Furtschegger.

FIFA, organizers in Russia and national teams have purchased insurance coverage well in advance of the tournament kicking off.  AGCS experts have been investigating risks in Russia and have been negotiating insurance policies for a number of years. "Anyone who still needs an insurance policy has left it late," says Furtschegger. “However, we are still seeing some last minutes requests for promotional campaigns.”