Certified Meeting Professional (CMP) Practice Exam

Reduced attendance insurance typically protects against what?

1. Normal fluctuations in attendance

2. Lower than expected attendance due to uncontrollable circumstances

3. Cost overruns in event budget

4. Weather-related cancellations

The correct answer is: Lower than expected attendance due to uncontrollable circumstances

Reduced attendance insurance is specifically designed to safeguard event organizers from financial loss arising from lower than anticipated attendance numbers due to circumstances that are beyond their control. Such uncontrollable events might include unexpected factors such as economic downturns, public health crises, or other situations that can prevent attendees from participating. When planning an event, securing this type of insurance can be essential, as it provides a safety net against the unpredictable nature of attendance. This means that if an event is affected by these unforeseen circumstances, the organizer can claim compensation for the financial shortfall resulting from reduced participation. The other options focus on different kinds of risks that are not covered by reduced attendance insurance. For instance, while normal fluctuations in attendance may occur from year to year, they do not constitute uncontrollable circumstances and therefore are not eligible for coverage. Cost overruns pertain to budget management and are typically addressed through different financial strategies or forms of insurance. Lastly, weather-related cancellations are generally managed through other insurance policies specifically designed for that risk, rather than reduced attendance policies. Thus, the accurate answer highlights the specific protection that reduced attendance insurance offers against unforeseen, external factors influencing attendance.