World Cup windfall or claims headache? Hospitality’s summer surge puts insurers on alert

Britain’s hospitality sector has experienced sustained pressure in recent years, having been hit in succession by Brexit, the pandemic and rising costs.

This summer, however, the tone has shifted, with a combination of domestic holiday spending and Fifa World Cup-driven footfall expected to deliver a rare uplift for the sector.

A survey of 2,000 UK adults published by broker Gallagher at the end of May revealed that more than a quarter of UK adults have altered their holiday plans due to overseas travel disruption, with staycation spending expected to generate £9.1bn for UK tourism.

At the same time, the Fifa men’s World Cup across North America is forecast to bring a significant boost to hospitality.

More than 15 million adults say they plan to watch at least one match in a pub or bar, with consumers expecting to each spend nearly £60 more than usual during the tournament. That alone could add £917m to the sector.

Sector rebound

For Dominic Roe, managing director for hospitality and leisure at Gallagher, the outlook marks a rare moment of optimism after a prolonged period of pressure.

“It’s sort of been a perfect storm,” he explained, citing the effects of Brexit, the pandemic and the cost of living crisis.

The industry’s significance to everyday life makes its recovery particularly important.

He explained: “It’s a sector we all love and it’s one of those that is very much a case of use it or lose it.

“[This summer] is a real injection. It’s a good news story for the sector and hopefully they can make the most of it.”

Claims pressure

Higher footfall is positive for revenues, but it also shifts the risk profile in immediate ways, with slips and trips remaining the most common exposure.

“When you get lots of people in a place, and a bit more alcohol flowing, slips and trips is probably going to be the biggest risk,” Roe said.

Hospitality establishments will already have procedures in place, but there is risk of breakdown under pressure.

“It’s all about properly risk assessing, having the right systems and procedures in place and being able to follow those systems and procedures,” he added, noting that crowd management was another pressure point.

And with millions expected in pubs for key fixtures, some venues may ”underestimate the numbers of people that might enter the pub”. 

But it is not simply larger crowds that create more risks – the World Cup’s North American location may also create additional exposures. 

John Askill, trading underwriter at MGA Aqueous Underwriting, said later kick-off times could extend trading hours well beyond those normally experienced during international tournaments.

Indeed, the UK government has stated that pubs and bars across England and Wales will be able to stay open late for any home nation knockout match during the tournament. 

Under the temporary change, venues will be able to stay open until 01:00 for knockout ties and 02.00 for any 22.00 kick-offs. 

Askill said: “Some of the kick-off times are much later than we’re used to, potentially seeing a game as late as 02:30, which could mean venues staying open even longer within government guidelines and the risks stretching further into the night.”

While he said major tournaments did not fundamentally alter hospitality risks, Askill noted they increase the frequency with which incidents can occur.

He added: “With better weather and more people heading out, venues usually stay open later and alcohol consumption goes up. That combination often leads to more incidents and claims.”

Prevention focus

But while additional risks may present themselves over the summer, hospitality insurance experts suggested that practical risk management measures can help venues capitalise on increased demand without increasing claims costs.

Askill pointed to CCTV, crowd control and housekeeping as some of the simplest ways to reduce incidents.

“Using CCTV effectively – almost like their own version of VAR – can help provide clear evidence and remove disputes if a claim arises,” he said.

He also recommended Security Industry Authority-approved security staff for larger events and said venue should ensure they maintain strong processes for dealing with spillages throughout busy trading periods.

“If I were advising a pub owner ahead of the World Cup, I’d be encouraging them to make sure their sums insured are accurate and to consider bringing in hired security to help ensure everything runs smoothly,” Askill added.

Cover gaps

Alongside operational pressures, experts warned that some hospitality businesses may be heading into the summer underinsured.

Premierline warned that many SMEs often fail to update their insurance ahead of peak trading, despite higher exposure from longer hours and increased stock.

The broker pointed to risks including theft, accidental damage, fire, liability claims and stock loss, particularly where businesses hire seasonal staff or extend trading hours during major events.

Rebecca Leversidge, marketing manager at Premierline, said summer can be both a growth opportunity and a period of heightened vulnerability.

“As footfall peaks, opening hours extend and temporary staff are hired, the likelihood of accidents or stock losses naturally increases,” she noted.

“Reviewing your insurance now, ahead of summer, ensures that your cover reflects the current realities of your business.”

This includes reviewing public liability, employers’ liability, commercial property and business interruption cover ahead of peak trading.

Askill also agreed that underinsurance remains a significant concern during major events.

“Venues might be holding more stock than usual or putting on extra events, which can push up their gross profits,” he said.

“Those changes need to be reflected in their cover if something goes wrong, but they can easily be missed in the moment.”

He added that brokers should use the tournament as an opportunity to revisit clients’ sums insured and business interruption arrangements.

“We’d always encourage brokers to have a quick check-in with their clients to make sure everything still stacks up and that they’re not unknowingly left underinsured,” he explained.

Balancing opportunity and risk

Despite the heightened risks of trading during times of heightened footfall, insurance experts highlighted that they were there to support the hospitality sector.

Askill said Aqueous’ appetite for hospitality business remained unchanged despite the expected increase in footfall.

But, he noted: “The only adjustment we’re making is around late-night games, where we’ll be taking a more flexible approach to opening hours in line with government licensing guidelines.

“Clients can think of this as a bit of extra time, giving them the freedom to stay open for those later kick-offs without worrying about it affecting their insurance cover.”

For hospitality businesses, that reflects the broader message emerging from the insurance sector this summer. The World Cup and staycation spending represent a genuine opportunity for growth after years of pressure, but one that requires careful preparation.

Askill finished by noting that venues which prepare properly for increased footfall and put the right controls in place will generally perform better not just operationally, but from a claims perspective.

“Good preparation won’t remove risk entirely, but poor preparation tends to amplify it,” he said.

For brokers and insurers, the challenge is ensuring opportunity is not undermined by avoidable losses.

As Roe put it: “We just don’t want pubs or businesses to look back and think, actually, we made lots of top-line growth, but it cost me a lot as well.”