The show must go on is the old saying, but any experienced event planner will tell you that’s not always possible. There are too many factors that are out of their hands: issues with performers, inclement weather and, increasingly, potential disruptions from riotous crowds, protestors and even potential terror acts or threats.

It’s a lot to manage, and any one of these disruptions can quickly turn what looked like a profitable event into one that causes organizers to lose more than just a little sleep. Handling all of these contingencies independently is extremely difficult, and more event planners and organizers are now using insurance protection to manage their risks and limit their potential downside.

Sorry, this event has been canceled

Any big event, like the Olympics, a major league baseball game or a Rolling Stones concert, is going to be covered by insurance to recoup losses if the event needs to be cancelled or abandoned. The bigger the event the more coverage the organizers want to buy, with coverage limits in the billions of dollars for large international competitions that have increasingly expensive television rights contracts. This coverage is necessary because you can’t control the weather or having a performer gets sick or injured before the event, and it’s not always possible to reschedule to an alternate date.

Event cancellation coverage is also now being purchased for smaller and more local events like county fairs, symphony orchestra concerts, minor league baseball games and many others that carry major financial risks for the organizers if they are canceled or abandoned. Even if the event can be rescheduled, there are additional costs incurred that insurance can help cover.

A rainy day policy

Organizers can insure against a rainout, but the bigger concern is often the events that aren’t cancelled, but that experience bad weather. If it’s too wet, hot or cold fewer people are likely to attend, and even those that do will spend less time at the event, and less money on concessions. That is exactly what happened at this year’s Governor’s Ball, a music festival in New York City, where severe rain the Saturday night of the festival caused much of the crowd to leave early before the Sunday show was canceled entirely.