Wedding Insurance: Protecting Against 'I Do' Mishaps

By Katie Little, CNBC.com

Irene Rios-Knauf and her husband spent a year planning their August nuptials, but they didn't expect one raucous wedding crasher - Hurricane Irene.

Nervous brides and grooms are turning to wedding insurance to protect themselves against vendor or venue bankruptcies and unpredictable weather.Nervous brides and grooms are turning to wedding insurance to protect themselves against … Purchasing wedding insurance was also absent from the West Haven, Ct., couple's checklist.

"At no point did we even think about getting insurance," David Knauf said. "We figured, 'We have a building. We're going to have a wedding.' When in fact we had to cancel, we were thinking, 'Oh my gosh, what are we going to do?' We did a lot of scrambling."

Wedding insurance has become an increasingly popular option after several high-profile instances of severe weather disrupted bridal plans last year. A shaky economic climate has also fueled interest in the policies.

The average price of a wedding climbed last year to hit $27,021, according to the Real Weddings Survey, and in some regions, it can cost more than double that price. The escalating costs are prompting many couples to turn to wedding insurance to protect these hefty investments.

Travelers is one of several companies that offer policies to help couples recoup lost expenses when bridal plans go awry. Premiums vary depending on the level and type of coverage that couples-to-be choose to buy. Policies typically cover lost expenses related to severe weather, sickness, vendor or venue problems, attire damage and military deployments.

"When you think of the $25,000 investment, buying a car for $25,000, you'd never think of not insuring it," said Chantal Cyr, vice president of Travelers Wedding Insurance. "I think people are just much more aware of needing to protect their financial investments."

Since the economic downturn, wedding insurance has attracted more attention from brides and grooms who are walking on financial tiptoes.

"Cancellations are coming through venues literally taking your money a year before the wedding, and they may have already filed for bankruptcy, and they're not going to tell you," said Rob Nuccio, president of R.V. Nuccio & Associates, the program administrator for Fireman's Fund wedding insurance.

Customers can purchase up to $250,000 in cancellation coverage through the company's website. For bigger-ticket occasions, couples can call the company to seek more coverage. Nuccio's company once insured a $2.5-million wedding.

Mara Urshel, co-owner of Kleinfeld Bridal, a New York City gown shop, said desperate brides have turned to her business for last-minute alterations, when they received newly purchased dresses from shuttered bridal stores.

"During the recession period, I think quite a few stores went out of business and left quite a few brides stranded," she said. "Sometimes they got the dress - sometimes they didn't. And sometimes, they wouldn't alter it."

At Travelers, 31 percent of claims originate from vendor or venue issues. About a fifth of claims are due to sickness, injury or mishaps. Claims for vandalism or theft and weather-related claims follow closely. The company offers up to $175,000 in wedding expense related coverage.

Runaway brides and grooms are not covered under the policy since a couple's "change of heart" does not qualify as unavoidable, Cyr said.

Irene Rios-Knauf and David Knauf postponed their wedding reception by several weeks due to Hurricane Irene.Irene Rios-Knauf and David Knauf postponed their wedding reception by several weeks due … Nuccio has offered change-of-heart insurance since 2007 although it does not turn a profit for the company. Brides and grooms cannot purchase these policies themselves due to a high potential for fraudulent claims among couples who sense their unions may be on the rocks. But parents or anyone else who is underwriting the wedding's cost can.
Despite its unprofitability, coverage to protect against cold feet generates press and the chance to create additional repeat clients for Nuccio's company.

"You've got to realize every time someone gets married, that's a brand new family, and that's potential to sell a homeowner's policy," he said.

Nuccio added that the economy has also fueled an increase in claims filings among customers, who are on the hunt for extra cash.

Kristin Koch, a senior editor at TheKnot.com, called wedding insurance "the ultimate back-up" and advised couples to have a detailed discussion with their vendors about what would happen if things go wrong.

If couples are not satisfied with a proposed contract, they should ask to amend it. Otherwise, they may not have any recourse in the event of a wedding disaster, Koch said.

In her six years as a wedding planner, Dena Davey, director of marketing at the Association of Bridal Consultants, has seen wedding insurance increase in popularity, especially for more expensive nuptials.
"I always recommend it," she said. "I'm not going to push wedding insurance, but I'm going to recommend it. Some people don't even know it's an option."

After unexpectedly sharing her special day with another Irene, Rios-Knauf has also joined the pro-wedding insurance camp. Although the pair recovered the majority of their cancellation costs and eventually held their reception several weeks later, they did lose some honeymoon-travel-related expenses.

She added that the couple's children from previous marriages will likely learn from their hurricane debacle.

"I think if they ever do have a plan to get married, if there is insurance offered, I think they'll take it," she said.

Wedding Insurance: Protecting Against 'I Do' Mishaps originally appeared on CNBC.com


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