The city of Los Angeles has asked LA28 organizers to take out a $650 million insurance policy in the event the 2028 Summer Olympics are canceled due to a natural disaster, terrorist attack or other type of major emergency.
City Administrative Officer Matt Szabo told organizers in a letter this week that the policy would “cover any potential losses” in the event of an unforeseen circumstance that would interrupt the Games, according to a report in the Los Angeles Times on Friday.
And while the letter did not specify what type of event would constitute a cancelation, there is plenty of precedent — recent and past — of the Olympics being disrupted.
The COVID-19 pandemic pushed the Tokyo Games from 2020 to 2021 and while the Olympics were not canceled, drastic changes impacting venues, contracts, staffing, ticketing, broadcasting and athlete qualification were ultimately felt. And when the Games were eventually staged in July and August 2021, it was largely without spectators for safety precautions.
Szabo’s letter cites its own internal report that notes that a $650 million insurance policy was taken out by Tokyo for the games, with the city and organizers estimating that they lost $3 billion due to the pandemic and a drastic reduction in spectator attendance, low ticket sales and poor sponsorship revenue.
And decades before the 2020 postponement, the 1916 Berlin Games were canceled because of World War I, while the 1940 Olympics were set to be held in Tokyo but reassigned to Helsinki after Japan forfeited hosting due to the Second Sino-Japanese War. But those Games would ultimately be canceled because of World War II, which also led to the 1944 London Olympics being scrapped.
Still, no Olympics have ever been canceled because of a natural disaster, terrorist attack, pandemic or civil unrest.
Only wars have triggered outright disruptions.
Los Angeles has already spent or made financial commitments that cover infrastructure upgrades, police and security, transportation venue preparation, temporary facilities, staffing, vendor contracts and separate guarantees to the International Olympic Committee.
LA28 officials acknowledged the insurance request and said in a statement that it “continues to engage with the City pursuant to its obligations in the Games Agreement by sharing required insurance policies and engaging with City partners regarding those policies.”
The city notes that their findings uncovered that all but one of the Olympic organizing committees since the 2004 Athens Olympics took out insurance in the event the Games were canceled. Athens took out a $170 million policy, while the 2008 Beijing Olympics took on $300 million in coverage, London’s 2012 Games had $400 million in insurance while $1 billion was set for possible losses for 2016 in Rio de Janeiro. Paris did not purchase any policy for the 2024 Olympics.
