No insurance payment for abandoned Kotla match

The Delhi & District Cricket Association (DDCA) and the Board of Control for Cricket in India (BCCI), organisers of Sunday’s India-Sri Lanka cricket match, will have to foot the bill for the abandoned tie as insurance companies are unlikely to pay any claim.

DDCA Secretary SP Bansal refused to disclose the amount the association would have to refund. Insurance industry sources said the association had taken a cover of Rs 12 crore for the match but, with 23 overs bowled when the match was called off, there would be no payment for the play being abandoned.

The policy is structured in such a way that even if one ball is bowled, the insurance company does not have to pay a claim. But the risk of advertisements is spread over 100 overs in a One-Day International and over 40 overs in case of Twenty20 matches.

Ticket refunds were expected to cost Rs 2.5 crore, sources said, while the compensation for in-stadia advertising could not be ascertained. Bansal said he was yet to get the data.

DDCA, headed by Arun Jaitley, had taken a cover against cancellation due to natural disasters, death of a political leader, riot, airline strike and civil commotion, among other things, the executive added. Bansal said an insurance policy had been purchased but did not share further details.

A bigger hit would be on account of compensation that BCCI would have to pay to Neo Sports, the broadcasters for the match.

A senior executive at National Insurance Company, which sold a cover to the channel, told Business Standard that Neo might not be paid any claim since the policy did not cover the pitch defect. To cover the risk due to the game being cancelled, Neo Sports had taken a cover of Rs 7 crore from National Insurance for loss of advertisement revenue.

“Discussions are on regarding who will pay for the revenue loss to the broadcaster. Due to inherent reasons, which were under the control of the organisers, the match was called off. So, they should bear the claim,” the executive said.

“We cannot comment on the issue till the surveyors submit their report,” Bansal said. He said the DDCA had no liability to the broadcaster though the Indian cricket board might have to bear some losses.

Insurance companies are now restructuring their policies for cricket matches due to large claims in the recent past from cancellations. Insurers are quoting a premium of 0.5-1 per cent of the sum assured. The cricket associations purchase these policies to insure against revenue losses.

Last month, Oriental Insurance had to pay Rs 8.75 crore to the Mumbai Cricket Association after the One-Day match between India and Australia was cancelled due to rain.