Local insurers benefit from growth of major sporting events

The growth in the number and scale of major sporting events being held in South Africa has benefited local players in the insurance industry, which are being utilised to provide risk management and insurance solutions for these occasions. Besides the immediate financial spinoffs, local companies in the insurance sector are also benefiting from the experience gained from providing these services, with some being requested to share their knowledge with insurers in other countries.

According to Anton Roux, CEO of Aon South Africa, which arranged and placed all the insurances required by the Local Organising Committee for the 2010 FIFA World Cup, the event is a good example of such opportunities.

“The premium for the event cancellation cover was the single largest premium ever placed by a South African organisation at Lloyds,” he says. The group has since processed approximately 861 insurance claims, mostly in the motor and asset space, with a total claims pay out value of around R 19.75 million”, says Roux.

Dr Danny Jordaan, CEO of the 2010 FIFA World Cup Organising Committee South Africa, last week thanked Aon South Africa for its contribution to the World Cup.

Roux says that besides the financial aspect, the tournament afforded companies such as Aon South Africa the chance to showcase specialist skills in Event Liability and Event Cancellation covers. "A year after the event, we are ready to share the knowledge gained with our colleagues in Brazil as they bid for an appointment to the Local Organising Committee for in Brazil for the 2014 World Cup."

The recent Top Gear Festival, one of the largest motoring festival the country has ever seen, is another example of a large event requiring expert and precise risk management solutions. Dani Ettridge of Aon’s Sport, Recreation and Entertainment Business Unit, says while the more than 75 000 attendees soaked up the trackside thrills in the rain this past weekend, few would have realised how much planning goes into the event. “There is detailed risk analysis being carried out alongside the diverse operational logistics behind the scenes. The presenters, the cars, the track, the spectators and even the weather must be considered.

“Managing big event risks require a clear understanding of how to best transfer risk at a viable cost to the organiser – something best delivered by a broker with experience in large-scale events,” says Ettridge.