IOC Acquires Cancellation Insurance

The International Olympic Committee has taken out insurance for the first time against cancellation of the Games because of war, terrorism or a natural disaster such as an earthquake, officials said Tuesday.

The IOC said it acquired a $170-million policy for the 2004 Summer Games, which begin Aug. 13 in Athens and have been dogged by construction delays and security concerns. Associated Press reported that the policy cost $6.8 million.

Security costs for the Athens Games now total more than $800 million and are climbing. Cost overruns for the 2004 Games now exceed $1 billion, Greek officials said Tuesday.

IOC officials, however, said the timing of an insurance deal is coincidental. They said they have been in the market for insurance for more than two years, prompted by the realization that, as IOC President Jacques Rogge of Belgium said in a statement, it is “standard, prudent behavior” for an entity at the core of a global movement generating $1 billion annually to carry insurance.

“We’re fully confident the Games will go ahead in Athens and be successful,” IOC spokeswoman Giselle Davies said.

The policy, Davies said, “is there to cover the core business. It’s a safety net we hope, and anticipate, never to need.”

The thrust of any insurance policy is not just to protect the IOC but to help safeguard the finances of international sports federations and national Olympic committees. There are 28 Summer Games federations and, currently, 202 national committees. Many federations and committees make it from one Olympics to the next largely through Games-generated revenue.