Canada’s 2026 World Cup excitement could mask a more prosaic problem for restaurants and hotels: many are still insured based on last year’s business.
With six matches in Toronto and seven in Vancouver, downtown hotels, restaurants, and tour operators are bracing for weeks of peak-season crowds. But CHES Special Risk senior vice president and director of underwriting Maruf Hasan (pictured) warns that some hospitality policies are still written off pre-World Cup revenue and stock levels – and that won’t be enough if something goes wrong.
“These mega events really change the risk profile for all the people who are involved,” he told Insurance Business. “Hotels will be running at maximum capacity. The restaurants full. People would be lining up in front of souvenir shops.”
It’s not just ticket holders. Professional teams, support staff, media, and sports journalists all add to the influx, he said. Visitors won’t stay put either: anyone coming to Toronto “must go to Niagara Falls,” putting additional strain on tour operators and ride-hailing drivers.
The problem, in Hasan’s view, is that part of the sector hasn’t translated that surge into hard numbers.
He pointed to a typical downtown pub or restaurant that did modest business and kept a relatively small amount of food and liquor on hand the previous year. As it comes up for renewal now, he says neither the owner nor, often, the broker fully accounts for the extra crowds the World Cup will bring.
In reality, that same venue is likely to see a substantial jump in revenue and will need significantly more stock to meet demand. Unless the insurance is updated to reflect that higher level of goods on site, a major loss would still be settled on the lower, pre-event figure – leaving the business badly short.
The same logic applies to business interruption. Higher turnover during June and July means higher profits at risk if a fire, flood, or other event shuts the doors. Yet many policies, he says, still carry limits and loss-of-profit assumptions pegged to a quieter year.
“In the event of a loss, what we will find is they are heavily underinsured,” Hasan said. “Then they will never be properly indemnified.”
Owners worry, with reason, that simply cranking up limits will send premiums through the roof. Hasan’s answer is structural: use the tools that already exist to target the exposure spike instead of paying to insure peak levels all year.
He points to layered insurance as one way to manage costs. Instead of purchasing a single, larger property limit, a business can arrange a smaller core layer and then add an excess layer on top. Structuring cover this way, he said, typically reduces the price of the top portion of insurance and helps keep the overall premium in check.
Another option is seasonal increase clauses. Stock limits can be written to step up automatically for a defined event period – for example, from June 1 to July 31 – and then revert. “You take the policy stock now, but you get a seasonal increase clause added in the insurance policy,” he said. “So your stock coverage goes up during that particular period. You are not paying an insurance premium for the full year for a bigger stock amount.”
Mid-term endorsements are the third lever. Even if a restaurant renewed in August and “maybe that time they didn’t think,” Hasan said they should request an endorsement now to increase both stock and business interruption limits for the World Cup window.
Hasan stressed that the onus is on insurance intermediaries to start those conversations.
“A lot depends on insurance brokers who are our partners, and they should be talking to their clients.” For accounts likely to be affected by the tournament, he wants brokers to “pick up the phone” and challenge underwriters on whether the current structure fits a mega-event year.
Operationally, the same dynamics driving higher limits also create more opportunities for things to go wrong. Hotels will be hiring seasonal staff – “many of them would be students” out of school in June and July, he notes – and restaurants will be running at unfamiliar speeds.
He argued that frontline staff need proper preparation to cope with World Cup-level crowds – from reception and security to anyone dealing directly with guests. Because many visitors will arrive from overseas, he sees multilingual and cross-trained employees as both a service upgrade and a way to reduce risk, helping smooth check-ins and defuse tensions in busy lobbies and dining rooms. If businesses fall short of those expectations, the damage doesn’t end with one unhappy customer: negative experiences are quickly broadcast online, and that digital trail can hurt trade long after the event is over.
The timing, he thinks, is still favourable. Hospitality renewals are spread throughout the year – there is “no fixed time” – but activity tends to pick up from March to October. That gives owners and brokers a window to reset before the first whistle blows.
“It is timely,” he said. “They can still have all these insurance policies arranged.” In his view, that also means re-examining standard $2 million liability limits that landlords often require. “For such a mega-event, if something goes wrong, $2 million may not be enough,” he said.
In a “tough world” with crowded streets and unsettled geopolitics, he added, terrorism coverage should be on the list too. Insurers can’t prevent a loss, he said – “we always come after the event” – but they can help make sure policyholders aren’t stuck insuring a World Cup on last year’s numbers.
