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Why won't Tokyo Marathon organizers pay back race fees after virus cancellation?

Runners are seen reaching the finish line at the 2019 Tokyo Marathon, in the capital's Chiyoda Ward on March 3, 2019. (Pool photo)

TOKYO -- With concerns rising over the spread of the new coronavirus in Japan, the Tokyo Marathon Foundation took the extraordinary step to limit the March 1 race to elite runners only, and announced that it will not be reimbursing participation fees.

Many people who had been set to take on the annual challenge have made their displeasure known about the decision, and asked for their money back. In previous cases where events have been canceled or postponed, the costs have been covered by event cancellation insurance, and money paid back from organizers to customers. But this time appears to be different.

The root cause of the non-payments seems to be based on the terms set down in the entry regulations for participants, which state that refunds will be paid only in the event of naturally occurring phenomenon such as strong rains or winds, structural damage by fires, earthquakes and orders to cancel the event by concerned authorities, among others.

Runners in Japan who applied through the Japanese website to run in the Tokyo Marathon paid 16,200 yen (about $145). The projected income from such fees in the budget for the 2020 marathon is expected to be 670 million yen, an increase of 190 million yen compared to the budget for 2019.

But according to individuals connected with the marathon, a great deal of money was already spent in the preparations leading to the event, meaning that there are apparently significant hurdles to repaying the fees.

A news release on the Tokyo Marathon's official website announcing the cancellation of general runners' participation is seen in this screenshot. (Mainichi)

After the Tokyo Marathon Foundation announced it would be canceling the general entry section of the race, a document was posted to its official website concerning the framework around participation fees. Basing its figures on the 2018 Tokyo Marathon, it said costs for the event would run close to 2 billion yen, with each participant seeing around 55,000 yen spent on them individually. It emphasized that a significant part of the money is necessary for preparations.

However, many large-scale sports events organizers for other past events have signed up for event cancellation insurance policies to repay customers in the event that unforeseen circumstances lead to cancellations.

Kamaishi Unosumai Memorial Stadium in Kamaishi, Iwate Prefecture, is seen deserted after the scheduled match between Namibia and Canada was called off due to the approach of Typhoon Hagibis, on Oct. 13, 2019. (Mainichi/Daisuke Wada)

When Japan hosted the 2019 Rugby World Cup, the tournament saw the first cancellations of matches ever in its history after powerful Typhoon Hagibis forced the unprecedented schedule changes. Organizers repaid tickets for the games, and reportedly insurance covered about 80% of the losses sustained by the decision.

The fine print on insurance policies differs depending on the kind of coverage taken out, but it is standard that up to 90% of an event's costs are compensated after the amount that organizers front for events is deducted.

Enquiries with the Tokyo Marathon Foundation revealed that they had taken out an event cancellation insurance plan. But reportedly because the new coronavirus was judged to be outside the terms of the policy, they could not receive a payment from insurers. Organizers precisely set the terms under which money can be returned because the scope for refunds covered by such insurance is limited.

Depending on the contents of contracts, infectious diseases like the new coronavirus can be excluded from the eligible conditions for an insurance payout. A PR department representative for a large insurance firm said, "Cancellations triggered by designated infectious diseases are ordinarily not included in insurance contracts. For insurance firms, they represent a big risk."

Some companies offer options contracts, in which cancellations caused by infectious diseases can be included among the terms eligible for insurance payouts, but the PR representative was not positive about their potential uptake, "If someone were to say to us that they wanted to take out a contract covering infectious diseases after the new coronavirus has already spread to this extent, I think it might be difficult for us."

Even organizers of marathons that have already taken place this year have had to deal with concerns over the viral outbreak. One person who belonged to the secretariat of the organizing committee of a marathon held in western Japan in February said, "We had event cancellation insurance, but when we consulted the firm providing our policy in late January as to whether the virus would come under eligible circumstances for us, we learned that it was not included.

"We even tried to take out an options contract, but they told us it would cost a considerable sum to do it, so for budgetary reasons we didn't. If the dates had been different, I have no idea how it would have gone. I'm just relieved we managed to put on the event with no issues."

(Japanese original by Hitoshi Kurasawa, Integrated Digital News Center)

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