Insurance options for multiple projects and the entertainment industry
by: Sam Levy, Rio Grande Insurance www.riograndeins.com
In the last two issues of Movie News, we’ve explored the coverage and considerations for single productions. In this installment we’ll take a look at insurance for production companies that make many productions as well as policies for industry related businesses. Read through the following list and descriptions to see how insurance would fit you!
Multiple Projects: DICE/Annual Productions
My favorite acronym in movie insurance is DICE which stands for Documentary, Industrial, Commercial(s) and Educational productions, which are typically made by production companies who need an annual policy because they have multiple productions throughout each year. Though the DICE acronym sounds as if it might be restrictive to the type of productions allowed, the underwriters are increasingly opening up this type of policy to almost all production types. DICE/Annual policies combine the best of both insurance worlds – they cover most of the specialized film-specific “producer’s risk” coverage that was discussed in detail last time with the broader scope of a general business owner’s commercial insurance. As you’ll recall, “producer’s risk” can cover shooting and other miscellaneous equipment, property owned by third parties, wardrobe/props/sets, negative/faulty stock and broad automobile coverage. Stunts and cast coverage can now be “bought back” onto these policies, a very recent addition to the offering. A DICE/Annual policy is rated on the average number of productions throughout a year in combination with factoring in of the budget of the largest average production.
We had discussed short term (less than 30 or 60 days) v. long term single productions, and you’ll recall that it is possible to get very affordable coverage for short term production policies of ten days of principal photography for $500. Typically a DICE/Annual policy is going to start around $1,300+ per year, so for a company that only makes two or three productions of ten or fewer days each, it may be just as easy to purchase a number of short term production policies. A DICE/Annual policy covers you for an entire 365 days of the year and takes into account office and incidental operations, so can be advantageous both financially and logistically. Note that in order to cover productions on a DICE/Annual policy, they must always be declared in advance to your agent.
Multiple Projects: Film Schools
You likely recall the scare tactics from the first article in this series in November warning against the dangers of sub-sold, paper based “co-production” arrangements from film schools. While the laws against co-production are still in place, they focus primarily on small producers that may be unwittingly taking advantage of a system. However, with the right insurance agent and policy, it is possible to get good coverage for film schools. There are policies specifically crafted to insure productions that are sanctioned by a film school at a U.S. university and for productions by students enrolled at the school. There are over 50 types of productions eligible for this coverage, but anything outside of the U.S. & Canada or with stunts must be insured as a sole and separate single production.
Multiple Projects: Production Portfolio
This recently added insurance option bridges the gap between DICE/Annual policy that is most appropriate and affordable for groups of smaller budget productions and full-fledged larger budget single productions. Production portfolio offers all of the coverages available to a larger production and offers the discounted advantage of aggregating schedules and budgets. This can be of particular advantage for a series. Production portfolio can handle groups of single project budgets up to $15 million and durations of up to 18 months.
Entertainment Services: Photographers, Videographers & DJs (and Shell Corps too)
This type of policy is specifically geared to the very small or sole proprietor business that covers private functions and/or public events. This insurance package puts together the most often requested coverage of general liability, auto liability & physical damage with equipment coverage, whether owned, rented or borrowed. Closely related to this type of policy is the “shell corp” policy for incorported individuals in the entertainment industry such as actors, directors, producers, writers, cameraman, singers, musicians, composers, radio/TV broadcasters, athletes and even touring entertainers.
Entertainment Services: Studios, including post-production
A Studio type of policy covers recording studios, editing studios, pre-production studios and post-production studios. This provides protection for entities continuously engaged in the business of providing a studio facility to the entertainment industry, for any of the purposed mentioned and their related uses. This can be tailored to fit the needs of small to large studios and coverage for catastrophe is available, including earthquake, wind and flood. Studio policies can have up to $5 million in equipment coverage and $10 million in liability as long as they are based in the U.S.
Entertainment Services: Rental Houses
Provides insurance for companies that supply the entertainment, sports and leisure industries with equipment and/or support services including installation. Again, this is for entities “continuously engaged” in the business of renting equipment such as cameras, lighting, sound, props, sets, wardrobe, trailers and more. They may provide equipment for special events such as props, sets, furnishings and more. This policy is closely related to the Studio policy and has the same high limits of coverage and catastrophe buy back available.
Entertainment Services: Floaters and Equipment Insurance
A floater covers property at an indeterminate number of locations U.S. and worldwide, generally for all risks. There are several types of floaters including personal and commercial equipment and valuable schedules. While entertainment equipment floaters are most common, and can be bought without any other coverage being required, we also handle standalone contractors equipment floaters, and personal articles. Personal articles can be comprised of valuables and collections including jewelry, fine arts and other miscellaneous items. A unique product, the film print floater covers not only film prints, but also certain expenses incurred to reprint, recopy or repair lost or damaged property from original material. Film print floater “covered causes of losses” include exposed film; damaged tape, interpositives and positives; work prints, cutting copies and fine grain prints; transparencies, cels, art work used to create images, and software used to generate computer images. Cut-outs and unused footage are not covered.
Entertainment Services: Events
Events policies are available for all sizes and durations of public and private one time and recurring events, as well as for vendors and exhibitors. Event insurance can cover cancellation, promoters, theatrical groups, venues and even cancellation. This can include festivals and trade shows as well as long duration events.
Entertainment Services: Commercial Insurance
As we get further down this list, you should begin to see the gap between a “normal” business policy and a “specialized” production policy narrow and begin to disappear. Obviously, production insurance branched out of general business insurance, and we do plenty of insurance policies for all types of businesses in the film industry that don’t do any of the specialized things mentioned above.
The word insurance is derived from the Latin word for security. In the 17th century, the word “insure” became established to mean “providing against loss and damage.” The bottom line is that insurance exists to protect you and your interests. To “indemnify” means to make you “whole” again and that’s what we insurance agents are here to do. Insurance is not about premiums and risk and your answering questions the “right” way, it’s about being protected and secure that you can go back to business without suffering an insurmountable financial loss.
Contact your insurance agent, trust and confide in them and be up front about what could happen and what you want covered. We are here to help you and to act in your best interest. Don’t be afraid to ask questions! Make sure you understand your coverages especially what is not covered or what your obligations are. If you can understand some of the available coverages by reading this article, you’ll be ahead of the game in asking questions of and having information to provide your agent. Especially in trying economic times, being fully and properly protected is essential to your future. That’s what we’re here for.
Send inquiries to sam@riograndeins.com
Sam Levy is the Film Insurance division manager at Rio Grande Insurance, www.RioGrandeIns.com
Providing superior service from Green light 'til Wrap, for all your production insurance needs, including: Single and Annual Production policies, Liability, Producer’s Risk, Rented equipment, Errors & Omissions, Work Comp, Directors & Officers, Hired and non-owned auto; Blanket additional insureds. All premiums count for 25% NM rebate.
14 local offices in NM, CA, AZ & UT.
1231 South St. Francis Dr Ste A, Santa Fe, NM 87505
Toll-Free: 888-447-8216; Phone: 505-984-8216; Fax: 505-984-8238
E-mail: sam@riograndeins.com
