Amid the heightened stakes in the IPL with the addition of two more teams and record-breaking player bids, insurers are exercising caution due to the overlap of the season with general elections, which increases the risk of cancellations due to unforeseen events.
For various stakeholders — franchise owners, sponsors, and broadcasters — the quotes are coming in 30-35 per cent higher, reported TOI.
“All stakeholders, starting from BCCI, the franchise owners, the sponsors, and the broadcasters, are seeking insurance cover. The stakes are significantly higher this year because of the addition of two more teams and the record bids for top players,” said Abizar Bohra, head of sports and entertainment, Global Insurance Brokers.
The cover is primarily for event cancellation, which results in a loss for all stakeholders. “In India, event cancellation happens largely due to adverse weather. Last year, the weather was good in major parts of the country. As a result, there were no large claims,” said Bohra.
The 2024 IPL, also branded as Tata IPL, will start on March 22, with the final scheduled on May 26. The Lok Sabha elections are scheduled to take place from April 19 to June 1.
“Even though there were no major claims last year, rates have increased this year and we are seeing 30-35% higher quotes. Buyers are talking to insurance companies, and the contracts are expected to be finalised once the full schedules are out,” said Bohra.
“The fresh challenge this year is because of elections. The polls are likely to take place in the midst of the IPL season, which adds to the risk of cancellation.” Bohra added.
Specialized event cancellation insurance is typically facilitated by brokers, with larger policies often provided by state-owned insurers such as New India Insurance and National Insurance. A PSU insurance official noted that restrictions on gatherings during polling might affect matches, but uncertainty remains regarding whether such risks would be covered.
This year’s total insurance exposure is not known yet as stakeholders are still to buy cover. Last year, the total exposure was estimated at Rs 10,000 crore. The insurance bought by broadcaster Star India for ICC World Cup had risen to Rs 1,800 crore. This did not include the cover purchased by other stakeholders.
(With TOI inputs)
