Electronic sports, or eSports, began as an underground activity but has quickly grown into a major industry. This form of competitive video gaming involving people playing against each other at in-person events or online for prizes has a significant fan base around the world, a host of professional players and teams, and a full calendar of tournaments.
With larger eSports tournaments attracting millions of spectators and the industry’s yearly global revenue now in the billions of dollars, it is clear that there is a lot at stake. eSports insurance can protect those operating in this business as it continues to rapidly change and grow.
Why Do eSports-Related Businesses Need Insurance?
The risks in the eSports and gaming industry are similar to other business risks in some ways, but the industry also faces its own unique exposures. Whether you are hosting a tournament at a venue that requires you to hold liability insurance before booking the space or you are a team that needs to show investors you are protecting yourselves from the unexpected, having the right type of eSports insurance in place is essential.
Challenges eSports Insurance Addresses
eSports insurance accounts for many of the challenges faced by those operating in this industry.
Event Risks
eSports events, like other mass gatherings, are vulnerable to attacks. In addition, there are many ways in which these events can go wrong. Organizers of eSports events need to take all of the potential security threats involved in dealing with large crowds seriously, and insurance is part of a proactive approach.
Legal & Regulatory
eSports companies are facing compliance challenges, particularly those involved in the betting and gambling markets, as regulations evolve, and having insurance provides valuable protection.
Emerging Risks
Although eSports has experienced significant growth in a short period, it remains an industry that is still in its early stages of development, which means that unforeseen risks continue to appear.
Recommended eSports Insurance Policies
Outlined below are some important types of eSports insurance policies.
General Liability
General liability is a broad policy that can protect all businesses against some common fundamental risks, such as property damage and bodily injury that occurs on the business’s premises.
Employment Practices Liability Coverage
Any business with employees needs protection against lawsuits related to employment practices, such as allegations of wrongful termination, breach of contract and discrimination.
Property Insurance
eSports entails the use of specialist equipment and infrastructure that can be expensive and difficult to replace. Property insurance covers damage to technical equipment and infrastructure, as well as property that is stolen or lost at events.
Cyber Insurance
The eSports industry is particularly vulnerable to cybercrime and internet-related risks. Modern cyber criminals are constantly developing new methods to wreak havoc and obtain funds and sensitive information from businesses operating in all industries, including eSports.
Even the best cybersecurity measures cannot prevent every potential breach, with threats including ransomware, phishing, malware, spam, botnets, physical manipulation, denial of service attacks and exploit kits. The financial impact of cybercrimes can be devastating, and insurance helps mitigate this risk.
Event Cancellation
Event cancellation is a useful type of coverage for occasions when planned eSports events run into an unexpected and unavoidable roadblock. Planning eSports events takes considerable time and effort, and when powers beyond your control lead to a cancellation, it can have a significant financial impact.
Event cancellation insurance reassures participants that the potential risks are covered, taking into account the unique needs of eSports events. It can cover expenses related to financial losses, ticket sales, venue costs, unexpectedly low attendee figures, hiring costs, and reputational damage control.
Event Liability
Numerous risks are associated with holding an event, from equipment damage to personal injuries. Event liability insurance offers coverage for accidents at eSports events, from damage to venue walls while moving equipment or injuries to guests while attending the event.
It can cover an injured guest’s medical bills if you are found to be at fault. Although many venues have their own liability insurance policies, it may not cover all situations. Some venues will require you to have an event liability policy before holding an event there.
eSports Team Insurance
eSports teams and the organizations behind them can gain protection against the wide variety of unique risks posed by their work. Higher levels of corporate investment and oversight in the industry mean that teams that wish to be taken seriously need to demonstrate that they have proper protection in place.
Reach Out To MFE Insurance Brokerage
MFE Insurance Brokerage offers insurance policies that are tailored to businesses and individuals involved in pro and amateur eSports. Our innovative coverages and risk evaluations provide specialized insurance policies that meet the needs of eSports officials, spectators, players, administrators and coaches.
With a focus on exceptional service and tailored insurance products, we are proud to offer our eSports clients a variety of policies from a range of reputable carriers. Reach out today to speak with an agent and find out how we can offer you affordable yet comprehensive coverage.