Olympians can cover Gold Medal glory
22 August 2008
For the past two weeks they have been the most sought after items on the planet. There are only 302 of them and once captured they will change the lives of those who possess them.
Surprisingly a gold medal from the Beijing Olympics is actually not solid gold. Indeed much of it is silver and only 6% of it is gold, but to the winners it is the most precious metal they will ever lay their hands on.
The Olympics remain the pinnacle for any sportsman and can open them up to global acclaim, victory parades, and lucrative sponsorship deals.
The UK team has surpassed every expectation with swimmer Rebecca Adlington becoming the first British woman to win two gold medals in the pool for over a century and cyclist Chris Hoy winning three golds in these games alone.
It also opens up some interesting issues for insurers. For while the medal may mean so much to the athlete who wins it, the insurance industry will take a pragmatic approach given the difficulty of putting a price on sentimental value.
As Richard Tolle, Vice President for the Global Sport, Entertainment & Events practice at Lloyd’s broker Marsh, says: “An athlete could insure their gold medal as you would any other valuable household item that requires all risks cover. The big issue is agreeing the value of the medal with the insurance company and establishing whether a replacement is actually possible.
“The medal will have an actual metal market value based around size, weight and purity but that is likely to be much lower than an athlete’s perceived value of the medal or even the eBay price!
If the International Olympic Committee will replace the medal, they may be able to indicate a cost to do this. Either way the key is agreeing with the insurance company the insured value of the medal.”
His views are backed by Daniel Smith, Director of Aon’s Fine Art and Specie team: “The medals can be insured on an all risks of physical loss or damage basis. The intrinsic value of the medals would be relatively low given the low price of silver. However, given the success of the games for Team GB, and with the build up to 2012, the commercial value may increase to in excess of ten fold the intrinsic value, maybe more for the likes of Rebecca Adlington.”
He added: “The discussion will be about just how you value the medal, because in cold terms it is the value of the metal which it contains, but it means so much more and would be viewed by the majority of people as far more valuable.”
However Smith says the chances of theft are low: “Given the limited nature of the medals if one was to be stolen the thief would find it hard to sell it because any buyer would question who the original winner was and the publicity surrounding the theft of a medal would make them almost impossible to pass on,” he explains.
“If it was stolen and kept you would be unable to show it to anyone because the chances are that word would quickly get out on its whereabouts.”
The UK team will have a victory parade next month when all the Olympic and Paralympic medal winners will travel on open top buses though London as part of the build up to the 2012 event.
Tolle says the insurance to safeguard the loss of the medals during the parade and the day’s events would fall on the winners, unless the organising committee for the games sought to exhibit the medals.
“In the case where an the London Organising Committee (LOCOG 2012) temporarily borrows all the medals to put them on public show, then LOCOG would have to insure them as they would be in their care, custody and control,” he says. “Again the key is agreeing the value and there may also be special security requirements as a warranty to the policy - eg locked and alarmed showcase, uniformed security permanently guarding the medals, in a room with CCTV/electronic detection etc.
“No other special insurance would apply for the victory parade unless LOCOG decided to include other more hazardous activities that would be normal exclusions under liability, property or PA policies that they would usually already have in place.”
Last updated on 22 Aug 2008
