The government has finally introduced a £750 million theatre insurance scheme – demanded for a year and promised for weeks by culture secretary Oliver Dowden – to insure live events forced to close by Covid restrictions.
But the Society of London Theatre and several top producers have already suggested the scheme, announced on Thursday, will not cover the major problems faced by producers trying to mount multi-million-pound productions and touring shows.
Some have even said the scheme is "not fit for purpose", since it doesn't cover the scenario they fear most – the closure of an entire production for a lengthy period on the strength of one Covid case.
Some have suggested the scheme will be "prohibitively expensive" and will lead to a major increase in ticket prices, since it appears to have been designed to cover one-off events such as concerts and business events, rather than theatre productions.
Top producer Cameron Mackintosh is one of those who consider the scheme unsuitable: “The prohibitively-expensive insurance on offer explicitly excludes some of the protection the theatre desperately needs, namely for cancellation of performances caused by illness or enforced isolation and the negative effect of the reintroduction of limited capacities, which would make most shows financially unviable,” he said.
Top producer Sonia Friedman, writing in a national newspaper, said insurance on a show costing £5 million to mount and £350,000 a week to run would cost an extra £750,000 over a 12-week run. The insurance will more than triple the cost of cancellation insurance bought by many productions.
The Live Events Reinsurance Scheme is effectively being run by insurance market Lloyds, with the government underwriting cover that commercial insurers would otherwise consider too risky.
Producers have for many months campaigned for such a scheme, thought essential to the full restoration of British theatre. Commercial producers have been unwilling to risk possibly millions of pounds mounting productions that could be shut down if just one Covid case is discovered among cast, crew or theatre staff. Touring shows are particularly hard hit because tour stops are planned months in advance and a halt in one place can have knock-on effects in others, with lost marketing costs and ticket refunds running into hundreds of thousands of pounds the result.
The Society of London Theatre – which has pressed the issue alongside UK Theatre, the two organisations covering many of the country's theatres and producers – said: “We welcome government intervention to help plug the gap left by this market failure – especially in relation to possible future national or regional lockdowns.”
But a spokesman added: “Self-isolation regulations have been forcing the closures of shows at short notice [Hope Fest in Manchester suffered just such a blow this week]. Social distancing audience caps have been a burden to an industry which requires high audience levels to be economically viable. The threat of possible reimposition represents a major risk. Theatre productions need long-term sustainable cover for shows running daily over a considerable period of time. These risks and requirements are not addressed properly by the proposal.”
The scheme will operate from September and run for a year.