As the summer months unfold, it’s wonderful to see the return of live sporting events from the delayed UEFA Euro 2020 soccer tournament to the 2021 Wimbledon Championships, and as the postponed 2020 Tokyo Summer Olympics gets underway on July 28, I will be among the millions watching from home on television, assuming it goes ahead as scheduled.

That thought struck a note during the recently televised U.S. Olympics gymnastic trials when one commentator made the point that for the athletes going on to Tokyo this would be the last time their families would see them perform live in-person ahead of the event. Overseas spectators were banned from the Tokyo Games months ago, and just recently the president of the Olympic organizing committee said that the decision to allow some local spectators into venues might be revisited.

Risk management protections to control the spread of COVID-19 in Tokyo are understandably top of mind amid concerns over the spread of coronavirus variants and as the city reported rising case numbers after it lifted a state of emergency in June. Recent reports of a surge in COVID-19 cases among Scottish soccer fans who attended a match in London during Euro 2020 are a reminder that large live events still present a challenge. Fortunately, there are some successful prototypes to learn from. For example, the National Basketball Association’s bubble environment that was put in place at Disney World during last summer’s 2020 playoffs was extremely effective at keeping athletes within its perimeter COVID-19-free.

As the world continues to move toward a new normal, with vaccinations in arms but herd immunity not necessarily reached amid variant surges and ongoing gathering restrictions in certain areas, it’s not just the safety of athletes and spectators and local communities that is in the balance. The event cancellation insurance market was among the hardest hit by the pandemic, with billions of dollars in claims. Since then, rates have increased, and capacity has tightened. Communicable disease exclusions were often a feature of pre-pandemic policies, but a “buy-back” option was typically offered under which policyholders could remove the exclusion and secure the coverage by paying an extra premium. Nowadays, communicable disease coverage is no longer available, even though new capacity has entered the event cancellation market.

For organizers of sports tournaments, music festivals, conventions or shows, the lack of pandemic insurance coverage adds to their problems as they try to ensure that events go ahead as planned and more revenue isn’t lost. Billions of dollars are tied up in many of the megaevents. Potential insured losses from the Olympics are estimated to be in the $2 billion to $3 billion range if the Games are canceled, for example.

Meanwhile, several countries are moving toward establishing government-backed entities covering the COVID-19-related cancellation risks facing event organizers. Such a scheme is reported to be imminent in Britain and possibly Germany, following a similar approach in the Netherlands and Switzerland. These temporary safety nets are a good way to support businesses and supply chains that have been decimated by the pandemic, but whether there should be a permanent backstop for pandemic insurance remains an open question in the industry. As private insurers continue to absorb the losses from prior canceled events, a temporary backstop would at least give them time to assess whether they can address the risk going forward.