With the Canadian National Exhibition (CNE) recently wrapped up in Toronto and the FIFA World Cup arriving next year, large-scale events are once again front and centre in the insurance industry. Behind the scenes, however, lies a critical question: how do you insure gatherings that attract tens of thousands of people and carry multimillion-dollar liabilities?
The answer is that insuring major festivals and global sporting spectacles looks very different from covering a local fair or community parade. Premiums are higher, liability limits climb into the tens of millions, and multiple insurers may need to share the risk. But as underwriters point out, the fundamentals of risk management remain the same – no matter how big the stage.
Carrie Clermont, (pictured), senior underwriter and team lead for hospitality at K&K Insurance Canada, explained that most large events begin with a core policy purchased by the organizer, while vendors and suppliers are expected to carry their own primary coverage.
“Typically how a large-scale event works, the insurance is purchased by the organizer. Depending on the event and size of the event they may require from individual vendors to provide their own primary insurance or the organizer may pick it up,” she said.
Depending on the size of the event, one insurer may write the primary coverage, but others often step in to provide excess layers. Clermont noted that some festivals carry limits anywhere from $5 million to $25 million, with multiple carriers involved to increase capacity for the event.
Despite the large numbers, the underwriting lens remains strikingly similar to smaller events. Liability exposures – from overcrowding to emergency evacuations – are still the focal point.
“It’s the emergency response plan,” Clermont said. “It provides detailed information with respect to communications, event details, incident command, emergency scenarios (ie. weather, fire procedure, bomb threat, lost person, equipment failure), emergency contacts, security plan, public transportation and parking."
These plans aren’t just paperwork; they can determine whether an insurer will even take on the risk.
Insurers view these plans as the backbone of liability protection because courts hold organizers to the highest duty of care for attendees.
A missing evacuation protocol or poorly documented crowd-control plan can significantly raise exposure if something goes wrong. Past tragedies across Canada and the US have shown how quickly crowd panic can escalate, and underwriters now expect to see evidence that organizers have planned for lost children, medical emergencies, and weather-related evacuations with the same rigor as they would for fire safety or security checks.
Underwriters expect to see detailed crowd management and evacuation procedures submitted well in advance, not rushed through in the final days before gates open.
In terms of market conditions, Clermont described large-event coverage as relatively stable. Rates are not hardening, but nor are they softening significantly. Instead, insurers are tightening terms.
“It’s basically holding its own right now … but companies are coming down with tighter terms, stricter exclusions, or tightening up policies where they might see a gap,” she said.
Capacity, however, is a persistent issue. Large events often request higher limits as organizers seek to shield themselves from catastrophic losses. Clermont said this is where insurers increasingly need to partner to meet demand.
This layering approach is common in the mega-event space, where one carrier might write the primary coverage but several others step in to provide excess layers. The logic is that no single insurer wants to hold the entire exposure for an event that could generate claims in the tens of millions.
Sharing the risk allows organizers to secure higher overall limits while giving carriers confidence that a single catastrophic loss won’t upend their balance sheets. It also means negotiations can be complex, with multiple underwriters scrutinizing the same set of risk management documents.
Brokers play a dual role: middleman and educator. Having already been trained by specialty underwriters, they must explain to clients why insurers demand extensive supporting documentation.
“They are the middle person, and the point of contact, but they are also educators, and invaluable for educating their clients. We work with many great brokers across Canada that understand the importance of comprehensive supporting paperwork that we require,” Clermont said.
Talking about common pitfalls, she pointed out that incomplete or last-minute submissions are among the biggest red flags.
“You can’t send in a major festival the week before the event takes place,” she said. Permits, site diagrams, and risk management plans need to be in place well ahead of time to ensure proper underwriting.
