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Sunday, June 6, 2010

World Cup has £6.2bn insurance, says Lloyd's

World Cup has £6.2bn insurance, says Lloyd's

The 2010 World Cup in South Africa has been insured for more than £6.2bn, according to Lloyd's of London, the world's biggest insurance market.

(Competing players will be insured against injury at the World Cup )

Football world governing body Fifa, national teams, broadcasters and other firms with a stake in the tournament's success have all taken out policies.

Stadiums and training venues for the World Cup matches are covered to the tune of £3.2bn, underwriters say.

But other business opportunities linked to the event account for another £3bn.

"Competitions, offers, prizes, sponsorship, broadcast rights - it's impossible to know how many there are, but all companies with these financial implications need coverage," said Chris Nash, active underwriter at Sportscover.

Delays and injuries

A Lloyd's spokeswoman said these indirect implications could range from retailers offering free goods if a particular team won the Cup to broadcasting problems caused by delayed matches.

"If the opening ceremony is delayed, that will affect the broadcasters, because they've got their advertising slots in place," she said.

"Similarly, if the final has to be delayed for whatever reason, people might want money back for their tickets."

World Cup insurance
Property - £3bn
Contingency - £3bn
Liability - £200m
Source: Lloyd's

One important factor not included in those estimates is the value of insurance policies applying to individual players in case of illness or injury.

Not every player in a team is considered to be of equal value. But according to underwriter Peter Thompson at Beazley, insurance against sports disability for a top footballer at the height of his career could go as high as £40m.

On top of that, the celebrity status of well-known players carries its own insurance price-tag.

Clubs rely on the star quality of their biggest names to boost revenues from replica team shirts and other merchandise.

That reputation also needs to be covered by insurance - and a world-class footballer's brand could be worth as much as £10m in its own right, says Dan Trueman, underwriter at Kiln.



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