IPL 2023 exposure exceeds Rs 10,000 crore; stakeholders mitigate risks with insurance covers

It is the 16th season of the Indian Premier League (IPL). Since its beginning in 2008, the league has become bigger with higher values at stake for various stakeholders including the Board of Cricket for Control in India (BCCI), franchise owners, sponsors, broadcasters, stadiums, and players. Consider this: BCCI earned over Rs 48,000 crore from the sale of media rights this season. That is over three times the price it fetched in 2018 and is now the second most valued sporting event, right after the United States National Football League (NFL). 

With the larger spending capacities of various stakeholders, the value at risk for Indian Premier League is estimated to be around Rs 10,000 crore this year. Experts say to mitigate the risk various stakeholders have taken different types of insurance covers to protect themselves from any loss of revenue.

Various stakeholders involved in IPL include BCCI, broadcasters, sponsors, franchise owners and ancillary service providers. They need to be covering any revenue loss on account of event cancellation due to unforeseen events, such as weather issues, riots,  loss of player fees, player-related risks such as accidents or loss of fees on account of injury or illness and medical costs and legal liability cover to protect against third-party liabilities.

“IPL is the largest sporting league in Asia and the total exposure this year is estimated to be upwards of Rs 10,000 crores primarily due to the presence of new players and the larger and ever-growing spending capacities of various stakeholders involved in the entire IPL ecosystem," said Shaista Valji, Associate Director - Sports at Alliance Insurance Brokers.

"The IPL event cancellation insurance covers availed by various stakeholders usually cover their respective loss of revenues or expenses associated with the event arising from a wide number of risks like inclement weather conditions, terrorism, civil commotion to name a few. However, the policy does not cover cancellation of matches due to Covid-19. Covid-19 is excluded from the policy because it is an ongoing condition, and therefore Covid cover is not available," added Vaji.

In 2022 tennis grand slam Wimbledon received an insurance claim of $142 million after the tournament was cancelled due to COVID-19. The All England Lawn Tennis Club had taken cover for infectious diseases leading to a huge claim settlement when the event got cancelled.