“Untenable” insurance policies could silence concert halls
The COVID-19 pandemic has already taken its toll on concert halls across Ontario, with several in Ottawa having closed their doors for good.
For those who have survived closures and capacity restrictions, however, there is now a new threat: Many small and mid-sized sites are facing remarkably high increases in their insurance premiums.
“You can buy insurance if you’re willing to pay, in some cases – and it’s not a made-up number – 4000% more than what you might have paid before,” said Erin Benjamin, president. and CEO of Canadian Live. Music Association, in an interview with CBC Radio All in one day.
“They are not that high, but they are certainly higher than the amounts before the pandemic.”
Many of these policies include conditions that are “simply untenable,” Benjamin said, such as only serving alcohol in plastic cups or closing before midnight. Some sites, she said, are waiving full insurance policies, putting them at risk of bankruptcy if something goes wrong and legal action takes place.
It’s not just the music industry that is facing this reality, Benjamin added, but many other companies in the tourism and hospitality industry.
The sky-high rates are caused by a “perfect storm” of pandemic-related factors, said Danish Yusuf, insurance broker and CEO of Toronto-based Zensurance.
âInsurance companies tell us that claims are on the rise, while at the same time, with less [businesses] being open, fewer are those who contribute to the pool and then pay claims. And so the few people who remain have to pay more, âsaid Yusuf All in one day.
“And some insurance companies are completely leaving the market. So insurance supply is also decreasing.”
All in one day12:47Concert halls that survived COVID may not be able to survive their insurance premiums
MP writes an open letter
It is “frustrating” to see large Ontario insurers reporting billion dollar profits during the pandemic as brokers and contractors “cannot get commercial insurance deals that meet their needs,” said Ottawa Center NDP MP Joel Harden.
Harden, whose constituency contains many concert halls, said he wrote an open letter to Finance Minister Peter Bethlenfalvy calling on the Ontario government to take “immediate action.”
Harden said All in one day the “almost self-regulating” insurance industry must either come up with competitive plans or be forced to do so by the government of the day.
The live music industry has been working on it for 20 months, since the beginning [of the pandemic].-Erin Benjamin
âIt’s a warning to the industry: if you’re not going to help brokers and small businesses, governments need to force them to act,â Harden said. “And an NDP government will.”
Benjamin said that at the moment the live music industry is not asking the province to step in and regulate commercial insurers, but rather to come up with some sort of solution.
Her conversations with the Ford government, she said, suggested they understand their plight.
âWhat we would really like is some help,â she said.
“The live music industry has been working on this for 20 months, since the beginning [of the pandemic] to try to find solutions directly with the insurance industry. We did not succeed.”