The staging of next year’s soccer World Cup – the biggest single-sport event in the world, not to mention a marketing bonanza – has been called into question following the collapse of its $1 billion insurance cover.

German insurer Axa Colonia Versicherung on Friday notified FIFA, the sport’s global governing body and organiser of the World Cup, that it wished to terminate its cover, subject to a month’s notice, due to the deteriorating international situation.

The event, to be staged in Japan and Korea, has attracted sponsors such as Adidas, Coca-Cola, Gillette, Budweiser, JVC, MasterCard and McDonald’s, each paying around $40 million to gain access to audiences in over 200 countries.

FIFA stressed the show would go on: “The staging of the 2002 FIFA World Cup in Korea and Japan is in no way endangered by this development. The world football governing body together with its insurance partners will now search for alternatives, while at the same time investigating the legal implications of this situation.”

Separately, German media giant Kirch Gruppe has reportedly sold South American TV rights to the 2002 and 2006 World Cups for over $860m.

The deals, some of the largest ever in international football, hand TV Globo broadcasting rights in Brazil, with DirecTV picking up contracts for Chile, Argentina, Uruguay, Venezuela, Colombia and Mexico. An announcement is expected in the next few days.

News sources: AdAge Global; Financial Times