Why is insurance a must for event planners?
A successful event planner isn't immune to errors or unhappy clients. That's why it's important to have the right business insurance for lawsuits, injuries, and other risks that could harm your business. It also helps you comply with state laws and venue insurance requirements.
Get the right insurance
6 insurance policies every event planner should consider
These insurance policies protect against the most common risks and liabilities in the event planning industry.
Business owner's policy
A business owner's policy, or BOP, combines general liability coverage and commercial property insurance at a discount. Low-risk small business owners are often eligible for this bundle.
- Slip-and-fall injuries
- Client property damage
- Business property damage
General liability insurance
A general liability insurance policy defends against third-party injury and property lawsuits, such as a client who suffers an injury at your event planning office. It's often required for a commercial lease.
- Client bodily injuries
- Accidental damage to a client's property
- Defamation and copyright infringement lawsuits
Professional liability insurance
Professional liability coverage handles lawsuits related to mistakes, poor advice, or other accusations of professional negligence. It's also referred to as errors and omissions insurance or E&O insurance.
- Planning errors and oversights
- Client dissatisfaction with an event
- Failure to deliver promised results
Workers' comp insurance
Workers' compensation insurance protects event planning businesses and sole proprietors from work-related medical bills health insurance won't cover. Most states require coverage for employees.
- Medical expenses from workplace accidents
- Disability benefits for injured workers
- Legal costs from work injuries
Commercial auto insurance
Almost every state requires commercial auto insurance for vehicles owned by an event planning firm. It covers financial losses and fees in the event of an accident involving your business vehicle.
- Auto accident legal fees
- Vandalism or other vehicle damage
- Vehicle theft
Cyber insurance
Cyber insurance helps planners recover from costly cyberattacks and data breaches. It's also called cyber liability insurance and is recommended if you store credit cards and personal information.
- Ransomware attacks
- Client notification costs
- Data breach investigations
Event planner insurance costs
From our customer data, here's a quick look at average event planner insurance costs:
General liability: $29 per month
Business owner's policy: $42 per month
Workers' compensation: $50 per month
Factors that insurance carriers consider when underwriting your premiums include:
- Types of event planning services offered
- Number of employees and additional insureds
- Value of your business property
- Types of insurance products purchased
- Coverage limits and deductibles
- Claims history
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Common questions about event planner insurance
Review answers to frequently asked questions (FAQs) about event planning business insurance and more.
Do self-employed event planners need insurance?
The insurance requirements for event planners are typically up to the state, county, and city in which they operate.
In most cases, if your event planning business has employees, you'll be mandated to carry workers' compensation insurance. Required in nearly every state, workers' comp protects your business should a staff member become ill or injured on the job. This coverage is also a good idea for independent contractors and sole proprietors, who are typically exempt, as personal health insurance won't cover work-related claims.
Additionally, event planners who drive company-owned vehicles must maintain the state-specified minimum amount of commercial auto insurance. It offers financial protection if you or your employees are involved in an accident with a business-owned vehicle, and will help cover medical expenses, property damage, liability claims, and uninsured motorists due to the incident.
Depending on your client, you may be asked to carry professional liability insurance (sometimes called errors and omissions coverage) before you can enter into an agreement with them. This is often true for government entities and local municipalities. Professional liability protects your business from expensive claims over the quality of your work.
Even when not required, insurance coverage is a critical component for any LLC, sole proprietor, independent contractor, and start up event planning firm. It not only offers peace of mind, but can protect your business from potentially devastating financial and legal costs.
Does event planner insurance cover losses related to a cancellation or postponement?
One fact of being an event planner is that you can't always avoid client or vendor cancellations or postponements. However, with event cancellation insurance, you can reduce the financial impact of lost deposits and other costs related to a cancellation or postponement. You can typically add this coverage to special event insurance for a fee.
Special event liability insurance provides coverage for third-party accidents at events, much like a general liability policy. This policy can help pay for legal costs from an injury or damage to someone else's property that happens during the event. Depending on where the event is held, the venue may even require special event coverage for all renters of the space.
While event cancellation insurance can help you recover from unanticipated costs due to a cancelled or postponed event, not every insurance company offers it and coverage may be limited. It's best to speak with your licensed insurance agent to see what is considered a covered claim and how you can get this coverage.
What other types of insurance coverage do event planners need?
For a comprehensive risk management plan, you may need additional protection to cover all the risks and liabilities your event planning business may face.
Event planners should also consider:
- Hired and non-owned auto (HNOA) insurance provides liability coverage for you and your employees if you or they drive a personal, rented, or leased vehicle for business purposes.
- Employment practices liability insurance (EPLI)helps pay for legal fees when an employee sues over a violation of their rights, such as wrongful termination, discrimination, or harassment.
- Liquor liability insurance: Liquor liability insurance covers damages caused by intoxicated people who were served by your business, and may be required by the laws in your state. However, it can't protect against the consequences of selling alcohol to minors.
- Directors and officers insurance (D&O) covers legal costs if an officer or board member is sued over a decision they made on behalf of your company.
- Commercial crime insurance often refers to fidelity bonds and other types of commercial crime coverage that can protect your business and clients in the event of employee theft.
- Surety bonds act as a financial guarantee that your company will fulfill the terms of its contract with a client.
- Commercial umbrella insurance activates to provide additional coverage when your general liability, commercial auto, or employer's liability insurance reaches its limit on a claim.
Some additional coverage you should consider is a hold harmless agreement. Also called an indemnity agreement, this coverage is a contract for anyone who works with you agreeing they'll refrain from suing your business in certain situations.
