If the artist has a bad reputation for canceling concerts, then it’s likely they’re going to have more exclusions and higher premiums, says Elizabeth Leontieff, chief operating officer of SteelBridge Insurance
“The insurance company is not in the business to lose money — they’re pretty careful when they write these policies to make sure they’re not going to have to pay anything.”
What depends on whether Kanye West will Win Lawsuit: Whether Kanye West wins his $10 million lawsuit against Lloyd’s of London over canceling shows on his 2016 The Life of Pablo tour depends on his medical history and how much he was willing to pay to make up for the risk, several concert-insurance experts say.
What is Kanye West’s Medical History: West’s doctor acknowledges the rapper “suffered a debilitating medical condition” that forced him to cut off two concerts and cancel the rest of the tour. Court documents state that he subsequently checked into UCLA’s Neuropsychiatric Hospital Center for eight days.
It’s unclear if West had a history of mental or physical illness before canceling the tour. “[Lloyd’s] do not like to pay out on cancelation claims for medical reasons, especially when the underlying reason is psychological or exhaustion as opposed to what they consider ‘real’ reasons like severe flu or bodily injury,” says a concert-business source. “Given Kanye’s touring history and volatility, I doubt he will collect the full $10 million.”
What led to the lawsuit: West’s touring company, Very Good, filed a claim two days after the cancelation, and his lawsuit alleges Lloyd’s has withheld payment. Typically, when a major artist begins a tour and seeks cancelation insurance, the insurance company investigates the artist’s medical history to assess the risk.
They never pay. – says John Scher
Do the Insurers actually pay claims: John Scher, a longtime New York promoter. “I don’t know exactly the conditions under Kanye’s claim, but my guess is they just don’t want to pay.”
But Peter Tempkins, managing director for entertainment for Hub International, a Nashville insurance company, says Lloyd’s has paid out numerous claims over the years. “Lloyd’s actually does pay — unless they feel that something is amiss,” he says. “Sometimes you have to fight to nudge them in the right direction.”
The reputation of the market has been built on meeting our obligations quickly and effectively where a claim should be settled,” the rep says. “In the last year alone we paid out over £14 billion in claims. The market will always take steps to find a solution amicable to both clients and insurers where there are disagreements through discussion and mediation. However, where an agreement cannot be reached, valid claims can only be paid on syndicates being satisfied that they have the information required to make any payment.”
Since the last thing Kanye wants to have to do is testify, either in court or through deposition, my guess is this is a strategic attempt to get [the] Lloyd’s companies to settle, says one industry source.
Adds Leontieff: “Very few insurance claims go to court. They usually settle.”
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