ok lete look at an example

you book well in advance for an event

you insure your inability to attend

you die / break a leg / fall seriously ill / go to jail

you cannot go, so claim on your policy and collect back your 70 quid

the event is then cancelled - do you give the insurer his clai back?

Point is, they have been on risk for a period between when you bought the ticket and when the event is cancelled