2020 Cape Epic Cancelled

[eddy]

Off the bat, Financial crisis’ are a lot harder to insure against than natural disasters. Pandemics are predictable to some degree. Also, co-insurance and reinsurance treaties are setup specifically for this. They are also very aware of their risk exposure for certain risk types, eg: events. If there is over exposure they will adjust.

 

When there is a government sanction cancellation, extra clauses come into play. Like Catastrophe events. When this happens there is extra protections.

 

This is only on the insurer side, the event organizers still need actually take out insurance with the correct cover amounts. edt: this is where I think there might be an issue. However the holding company of the Epic are well versed in running events and the legalities around it.

 

 

Aware of that, and I hope you are right but AIG was to big to fail and yet it did. Lots of people who thought they were covered found out too late that the cover wasn't worth the paper it was written on. 

 

I wonder which underwriter or reinsurer has reserves to cover and survive the CONCURRENT cancellation of the Olympics, the F1 season, the NFL, NBA, English and European football leagues, 6 Nations, US Masters and 20 PGA golf events each with a budget dwarfing that of Epic, Wimbledon, the other 3 Grand slams and all other tennis events, probably Giro and possibly TdF, etc, etc. whilst the global economy contracts drastically at the same time?

 

In this context Epic and IM are minnows. The total Epic budget would struggle to buy a 30 second advertising slot during the Super Bowl, at $9.2million a minute.  

 

And that is just sporting events. Add to that entertainment - Glastonbury and all other music concerts, theater show runs, etc. In a wurst käse scenario even the Munich Oktoberfest.

 

May the same co- and re-insurers not also be on the hook for covering losses in industries other than events ? Credit guarantees will be called upon as hundreds of thousands of business go to the wall globally. Travel insurance as flights are cancelled and airlines and hotel groups go bust. Unemployment insurance as millions lose their jobs. Professional liability insurance as class action scumbags start suing the doctors and hospitals that failed to save people's loved ones (can almost guarantee this will be tried on), 

 

This is not likely to be one house burning down or even all houses in St Francis burning down, but all houses in many places and many houses everywhere burning down. All at the same time.

 

I hope I am wrong but I think the insurance industry will be hard hit.

 

ps.

 

If there is any consolation to me it is that I am not a Lloyd's name......

[Patchelicious]

Not an expert on this but catastrophes are usually localised so insurers can spread their risk, but if the whole world starts claiming for the same incident then insurers are stuffed.

 

Unless the claim amounts are small enough for insurers to handle I guess

You are absolutely right.

 

What we also need to consider the drop in claims for other risks.

With the reduced travel, many other risk types, motor, personal accident etc will drop and limit losses.

Edited March 19, 2020 by Patchelicious

[Patchelicious]

Aware of that, and I hope you are right but AIG was to big to fail and yet it did. Lots of people who thought they were covered found out too late that the cover wasn't worth the paper it was written on. 

 

I wonder which underwriter or reinsurer has reserves to cover and survive the CONCURRENT cancellation of the Olympics, the F1 season, the NFL, NBA, English and European football leagues, 6 Nations, US Masters and 20 PGA golf events each with a budget dwarfing that of Epic, Wimbledon, the other 3 Grand slams and all other tennis events, probably Giro and possibly TdF, etc, etc. whilst the global economy contracts drastically at the same time?

 

In this context Epic and IM are minnows. The total Epic budget would struggle to buy a 30 second advertising slot during the Super Bowl, at $9.2million a minute.  

 

And that is just sporting events. Add to that entertainment - Glastonbury and all other music concerts, theater show runs, etc. In a wurst käse scenario even the Munich Oktoberfest.

 

May the same co- and re-insurers not also be on the hook for covering losses in industries other than events ? Credit guarantees will be called upon as hundreds of thousands of business go to the wall globally. Travel insurance as flights are cancelled and airlines and hotel groups go bust. Unemployment insurance as millions lose their jobs. Professional liability insurance as class action scumbags start suing the doctors and hospitals that failed to save people's loved ones (can almost guarantee this will be tried on), 

 

This is not likely to be one house burning down or even all houses in St Francis burning down, but all houses in many places and many houses everywhere burning down. All at the same time.

 

I hope I am wrong but I think the insurance industry will be hard hit.

 

ps.

 

If there is any consolation to me it is that I am not a Lloyd's name......

Thats a good example of the what I am referring too. Our local insurers ( some friends we share), who covered some of those properties were quick to claim massive losses, however 80% of those losses were paid by offshore re-insurers. 

 

Yes, you are right looking at the Epic, these are minnows. I am not sure how events like the Olympics cater for these losses. Often these bespoke cash positive organisations cater for this with their own cash reserves, "self insure".

Edited March 19, 2020 by Patchelicious

[dev null]

Certainly if the entry or money was returned I would hand it back to the sponsor. I don't think that's what Moridin was asking though. I interpret his question as will sponsors recover their loss from the riders they sponsored. in that case I think its a great question. if the entry is carried over to 2021 or the entry fee is returned then I don't think the riders would even know unless the sponsor wants the rider to returm for 2021. In most sponsored cases the sponsor pays the Cape epic for the entry directly so if the entry fee is refunded it will go back to the payer is how I understand it

 

Yup, that is basically what I was asking.

[T_Boss]

 

Wait.. do mechanics ALSO have to pay the epic a fee for the "privelidge" of providing mechanic services to teams?

The Epic and pretty much every other event too. I have no connection to the epic so no reason to defend them, but why would they give a service provider a platform to operate their business and advertise their “brand” for free? Doesn’t really make sense.

 

As mentioned, tweede kamp service providers pay a pretty penny to be there. But don’t thing the official event “service providers in the main area get off lightly, they probably need to cough up even more as they are official event sponsors/partners.

[T_Boss]

No, that is not how event financials work. Most sponsorships are financial contributions.

Yes, and they normally only pay at the commencement of the event, or in some cases after the successful completion of the event.

 

As the title sponsor, maybe ABSA will make some compensation available to ease the blow and make it possible to run the event next year, but I won’t be surprised if the other sponsors don’t pay a cent this year

[Skubarra]

Crazy to think we now would have been a little more than half-way through the Epic.

 

Few days ago people were bashing the organisers (ok some still are) for cancelling, now it's unimaginable that the event would still have been continuing. 

 

World changed a lot the last few days

[Grease_Monkey]

Check your policy schedule, there will likely be limits.

I'm sure there will be... but my point is pretty much the same as yours - insure your event one way or another if it so expensive!

[Patchelicious]

I'm sure there will be... but my point is pretty much the same as yours - insure your event one way or another if it so expensive!

I hate to sound like a stuck record, but insure anything that you cannot afford to lose. But as always, speak to a broker to make sure that you are protected!

Edited March 19, 2020 by Patchelicious

[DieselnDust]

Or insurance for marriage.

 

 

Now there's a high risk product

[Tim Brink]

Discuss: 

[Jewbacca]

Discuss: 

The fans demand it... If there weren't so many 'You're so rad', 'Lekker boet, f*k alles, julle is so mal' etc comments fueling the idiocy on social media I'm 100% sure the 'gees' would die and the reality of what they are doing would set in.

 

The fans.... The Ego.... The circle 

[T_Boss]

Discuss:

Just remember, the sooner everyone gets this, the sooner we can go back to business as usual! Unfortunately lots of people will die in the process. Some of them may even be known to you.

 

The issue in SA, and the rest of Africa for that matter, is governments have made countless empty promises for years, but have failed to provide decent housing/sanitation/healthcare etc. added to this, aids denialism is now going to bite them in the arse, never mind the fact that the poorest insist on breeding non stop. As sad as it is, this virus is just doing what Mother Nature intended, and trying to balance the scales again.

 

Objectively, Covid19 is not really a big issue - the log term effect caused by the panic and disruption is.

 

Subjectively , one might feel different and feel worry/concern/remorse for your fellow human or at least your loved ones who are at risk.

 

Population growth is still going to outstrip deaths from Covid 19. In 18 months from now, most people will have forgotten all about this. We need to be smart about how we approach the time in between, so that the whole system doesn’t collapse and everyone is bankrupt and destitute by then, because that will lead to things far worse than this virus.

[Grease_Monkey]

Edit: not worth it.

Edited March 19, 2020 by Grease_Monkey

[Stretch]

If AIG were still around they would probably give it a punt!

I bought travel insurance from AIG the other day....

[BigDL]

How can you retain money for services not rendered. It doesn't work like that. That LBS should be named and shamed

Presume they’ve bought parts, perhaps prepaid accommodation, maybe taken On extra staff for the event. I would imagine that cash flow is what’s stopping the refund, not unwillingness