Candy Adams, CTSM, CME, CEM, CMP, CMM, is an independent exhibit-management consultant, trainer, speaker, writer, and an Exhibitor conference faculty member. CandyAdams @BoothMom.com

n expensive server rack commits suicide off a 4-foot-tall shipping dock. A forklift skewers a carton of exhibit graphics. Demo equipment gets stolen in transit. What do all three of these situations have in common? They have all happened to me. Thankfully, in every case I had planned ahead and placed insurance on my clients' exhibit properties to cover their losses.

As exhibit managers, insuring against losses that we might incur isn't usually on the top of our to-do lists. Logistics, deadlines, and troubleshooting often take precedence over identifying, evaluating, and managing the financial risks of exhibiting. But trade show-related disasters are bound to happen. Author and risk-management expert Charles Robert Tremper says, "The first step in the risk-management process is to acknowledge the reality of risk. Denial is a common tactic that substitutes deliberate ignorance for thoughtful planning."

There are basically four types of coverage exhibitors can secure to mitigate common exhibiting risks:

1. Commercial general liability covers bodily injury or property damage to a third party.

2. Exhibit-property coverage insures your exhibit and other company property that is used at a show.

3. Limited-liability valuation is coverage provided by your transportation carrier for property damage during shipment.

4. Event-cancellation insurance covers financial losses in the event that the show doesn't go on.

Carefully selecting the proper insurance options will keep you and your company sufficiently covered - and will prevent exhibit-related incidents from becoming catastrophic calamities.

Commercial General Liability

Think back to that space-rental agreement you signed a year before the show. In the three minutes you had to select space and turn in your contract before scurrying back to your exhibit, did you laboriously pore over the terms and conditions on the back of the agreement? Did you read the 17 pages of rules and regulations in the exhibitor services manual? To refresh your memory, you probably signed something that says you'll maintain a certain level of liability insurance coverage, usually $1 million per occurrence and $2 million aggregate for multiple occurrences. This is called commercial general liability (CGL) during the "lease period" of the convention venue.

This insurance provides coverage against damage or injury to persons and property during setup, show days, and dismantle. The contract usually requires that this CGL policy will name any or all of the following as additionally insured parties during the lease period of the venue: the show organizer, show manager, general services contractor, official subcontractors, and venue. You may also be required to send the show manager a copy of this policy/rider or bring it to the show to be viewed upon request.

Where do you purchase this type of insurance? If you work for a corporation, it's almost a given that you already have a CGL insurance policy in place on which you can just piggyback the show's specific requirements. Corporate insurance is usually administered by your internal risk-management or finance department. If they don't handle it, they can refer you to your company's insurance agent. The simplest way to provide the insurance carrier with the information it will need is to send it a copy of the space-rental contract and/or the pages from the exhibitor services manual that lists the specific insurance requirements, dates of coverage, and names of those who need to be listed on the policy as additional insured parties.

If your company doesn't carry this type of insurance coverage, you can purchase a policy through companies that specialize in exhibitor insurance, such as K&K Insurance Group Inc. (www.kandkinsurance.com), John Buttine Inc. (www.buttine.com), CSI Entertainment Insurance (www.csicoverage.com), or Canfinse Group Inc. (www.exhibitorinsurance.com). Depending on the length (one show versus an annual policy) and amount of coverage required, the cost of these policies can range from $125 to $1,000. Some shows offer CGL coverage through a preferred carrier in their exhibitor services manuals; many shows mandate purchasing coverage through their preferred carrier for $125 to $150 per show.

The penalty for not having the insurance the show manager asks for varies from one show to another. But if there is an incident and you can't provide proof of the requested insurance, your exhibit can be removed from the trade show floor.

Exhibit-Property Coverage

What would happen if your exhibit house burned to the ground with your exhibit in it? What if the truck transporting your exhibit was totaled in an accident, and your exhibit was demolished? What would you do if your new plasma monitors were all "misplaced" somewhere between arrival at the advance warehouse and delivery to the convention venue?

Talk with your boss and corporate risk manager to figure out what coverage you currently have on your exhibit properties. Ask the following questions:

1. Is your exhibit currently covered by a corporate property policy, or can it be covered with the payment of an additional premium?

2. What are your coverage limits and deductibles (e.g., $150,000 per show or occurrence with a $10,000 deductible)?

3. Does the policy cover your exhibit properties for replacement value or depreciated value? If it's for depreciated value, what is the current value of your exhibit properties and what would it cost you to replace them?

4. Is the coverage amount sufficient to make you "whole" after the claim? Would you have enough claim monies to replace or repair your exhibit properties in the event of loss or damage?

5. Under what circumstances are your exhibit properties covered by this insurance policy (per show, per half year, or per year)? Are they covered while off company premises (e.g., at your exhibit house, in a carrier's truck, or at the advance warehouse)?

6. Do you need to notify anyone in your risk-management department or at the insurance company to let them know when your exhibit is on the road?

7. What do you have to do to notify the insurer of a loss and make a claim (e.g., make a report with convention-center security, file a police report, take photos, call a toll-free number or agent to report the loss, notify corporate risk management, etc.)?

8. What documentation would it take to file a claim (such as serial numbers of lost equipment or invoices for the exhibit properties)?

9. How long after an incident do you have to file the claim paperwork? Some policies only give you a limited time to file the claim - such as 72 hours - and that timeframe could very well be while you're still at the show. Other policies I've seen give you up to six months after an incident.

Some corporations choose not to cover exhibit property because they don't want a series of small claims filed that could cause a jump in their overall corporate insurance premium rates. If you learn that your company falls into this category and considers itself "self-insured," which means you have no external coverage for claims, or if it carries a high-deductible policy, figure out how you would cover a loss. Is your current budget healthy enough to absorb the cost, or do you need to purchase a supplemental policy from a company that specializes in exhibitor insurance?

Limited-Liability Valuation

Limited-liability valuation, also called released value or trip-transit valuation, is provided to you, the shipper, automatically as part of your carrier's liability under the shipping tariff at no additional cost. It covers the freight in your shipment during the time it is loaded on your carrier's truck, from one point of origin to one point of destination. Carriers' limits on valuation vary by state law, and are in the range of $.30 to $.60 per pound, per article of freight, or sometimes on a per-item basis (e.g., $100 per item), whichever is greater.

This coverage is "valuation," not insurance. These two terms are often confused and considered synonymous. But carriers are not insurance companies and can't legally call this coverage "insurance."

Early in my career, I learned the hard way about making a valuation claim. A mounted digital graphic for the front of my reception counter came up missing from a pallet during shipment to a show. When I inquired about coverage for the loss, the carrier's agent asked me about the size and weight of the graphic. I stated that it was 18-by-18 inches and was mounted on foam board, so it probably weighed about 3 pounds. The agent laughed and told me the company probably wouldn't process a claim for $1.80 (3 pounds at $.60 per pound).

If this amount of limited-liability coverage isn't adequate, carriers may offer to sell you additional valuation, also known as full valuation protection, at a price of around $7 per $1,000 of value you wish to cover in thousand-dollar increments. This cost will be added as a line item to your invoice for each shipment.

Don't forget that this valuation is in force only when the shipment is on the truck. When the shipment hits the docks - at the advance warehouse, convention venue, or exhibit house - there is no further coverage. It only covers property being shipped while it is in the carrier's physical possession.

The most economical way to cover your shipment's value may be to add a "door-to-door" all-risks insurance rider (aka "portal-to-portal rider") to your corporate insurance policy. This coverage can include physical damage or loss during transit or on the show floor, water damage, breakage, and theft or pilferage. Work with your corporate risk-management department to determine the replacement value of your entire shipment and how much risk you want to assume with your deductible. All-risk policies are also available for purchase through some freight carriers and online insurance brokers.

Event-Cancellation Insurance

Some people call event-cancellation insurance "sleep-well" insurance because they don't have to worry about the losses they would incur if the event were called off, rescheduled, or even poorly attended, depending on the individual policy. Event-cancellation policies can be purchased with varying policy limits (most start at $10,000 and go up to as high as $50,000 without special underwriting) to cover anything from a single exhibit at a single show to multiple exhibits for an entire year. Depending on the risks covered, premiums can range from a few hundred dollars to a thousand dollars.

When purchasing cancellation insurance, read the policy carefully so you know what is covered - and what is not. Recently, a client asked me what would happen to the hundreds of thousands of dollars her company had invested in its biggest show of the year, scheduled at what some believe will be the height of this year's flu season, if the event is cancelled due to an epidemic or pandemic of the H1N1 virus. All of the packaged policies for exhibitors that I found had an exclusion for communicable diseases. One broker I spoke with said his company would cover event cancellations due to H1N1, but only as an expensive rider to a standard event-cancellation policy.

Typical incidents covered by event-cancellation insurance may include terrorist activities; venue damage; labor disputes; natural disasters such as severe storms, tornados, flooding, and earthquakes; nonappearance of principal speakers; late or non-arrival of items essential to the event, such as exhibit properties; and even cancellation due to national mourning for the death of a U.S. president. Some policies also include coverage for future marketing expenses you may incur if the event is rescheduled.

Trade show disasters can and probably will eventually happen to you. Be ready with the right insurance. You'll not only ensure your program's ability to bounce back quickly from any unpleasant scenario; you'll sleep better knowing that no matter what happens, your program is covered.e