A good movie or show can entertain, educate, and inspire us as viewers in various ways. Films/shows have become a big part of our lives and a go-to entertainment daily – especially with platforms like Netflix, Amazon Prime and Disney+.
Although, have you ever thought about how these movies are made and how expensive it is to produce? Creating a movie or show can be challenging for producers, actors, directors, and crew members. There is a long list of risks when producing a film project, from accidents to error lawsuits. One accident can cost a producer/company millions or even more. The risks are due to the expensive equipment, cast & crew liability and possible lawsuits by the public.
It can be stressful for a producer and crew to create projects. Unexpected risks are why producers and entertainment companies purchase film insurance. The insurance allows them to breathe easier and know that film insurance will cover unwanted accidents.
The article will explain why film insurance is vital to any producer of any visual entertainment project.
What is Film Insurance?
Film insurance protects the production company or individual film project from any possible liabilities during filming. There are various categories of films, such as low-budget short films, feature films, commercials, documentaries and shows. Insurers can customise policies to be the perfect insurance fit for the project. The film insurance policy will financially cover injuries on set, equipment damage, errors and omission claims, and third-party damage.
Additionally, the producer must be honest with the insurance company to gain high insurance coverage and register all equipment, script, and project members. Believe it or not, some stunts are almost un-insurable.
Why Do Producers Need Film Insurance?
Errors and Omission Claims
Creating a great movie comes with great responsibility. When making a movie, the creative team involved has a duty to the public to entertain and simultaneously not offend any of the viewers. Films commit to being original, not speaking negatively of any group and providing the right message to viewers. When a film has made an error and has not obeyed its responsibility, it may be a victim of a lawsuit—resulting in a substantial financial loss and production company brand damage.
Error and omission claims can occur at any time and from anyone. For example, the famous Netflix series ‘Queens Gambit‘ was a victim of an inaccurate representation lawsuit. Queens Gambit shows the life of renowned chess player Nona Gaprindashvile and how she became a chess champion. Unfortunately, Nona Gaprindashvile filed a lawsuit against Netflix, seeking millions of dollars for being misrepresented.
The series showed her playing against men and being an all-sex world champion, but Gaprindashvile said, “She’s the female world champion and has never faced men”. The case resulted in Netflix facing a significant financial loss due to the case and compensation settlements.
Film insurance is the best coverage for such situations, as the insurance will cover the cost of lawsuit defence and settlement costs. All entertainment companies must be protected from errors and omissions claims, as errors are unpredictable. Film insurance will save the company from significant losses and protect its brand image.
Cast Injuries & Illness
Many of us would agree the actor is one of the most crucial factors in a movie. Producers would agree as they provide a hefty salary to do the role justice. Therefore, when a cast member is injured, it puts an immediate pause on the production of the movie or show and can be costly. The costs include medical costs and film interruption loss. Thousands of injuries have occurred due to the stunts that make us drop our jaws. The production company is responsible for paying for their medical recovery and halting production until they return.
For example, Jackie Chan is among the most popular action actors worldwide. He performs his own stunts, which is impressive for us viewers but a producer’s nightmare. In the act of performing his stunts, he has broken his nose three times, his ankle once, most of the fingers in his hand, both cheekbones and his skull.
Film insurance brightens producers’ nightmares, as this insurance will provide the costs related to the cast’s liability. Although film insurance doesn’t mean that producers can allow their casts to perform any stunt, the insurance company needs to be informed about each stunt for it to be insured.
Therefore, as long as the stunt isn’t too dangerous, the insurance will help the producer or company cover their cast throughout the project’s production. The cover includes injuries, illness and project interruption costs.
Creating a movie needs plenty of equipment, from cameras to microphones and lights. These film assets are costly, especially in a feature movie, show and commercial. If you think that Sony or Canon DSLR cameras are costly, you should look at the price of commercial cameras. Unfortunately, despite how safe one is, accidents and slips happen, which result in broken equipment. Damaged equipment has to be replaced or fixed instantly for the project to continue and avoid lengthy interruptions.
For example, when filming in crowded or outdoor sets, the risk increases of someone accidentally pushing a camera over. In addition, an average Hollywood filming camera costs a minimumofUSD 28,000 (HKD 218,158). Therefore, when a camera like this is damaged, it can be a disaster for the schedule and budget.
The film equipment cover included in film insurance will provide the repair and replacement cost of the damaged or lost property. The insurance will cover rented and owned equipment, although the producer or company must give the insurer a list of all equipment used. The insurer will not cover any equipment that the company has not listed.
Film Crew Protection
The film crew is as important as the actors and plays a crucial role in making the movie. Crew members are seen as production company employees, meaning the production team is liable for any work injury or illness on set. When a crew member is injured or sick, the production team will pay for their medical bills and possible compensation costs.
Accidents on set are quite common and can affect an actor or crew member. At times, the crew member can be seriously injured or even die. For example, in October 2021, Alex Baldwin(actor) accidentally fired a real gun with a bullet due to a mix-up in props. Unfortunately, the shot fired accidently hit the cinematographer and sadly killed her. It was a devastating situation, and the production team’s duty was to provide the victim’s family with considerable compensation. Such cases can also bring large lawsuits that affect the production team.
Like cast liability, film insurance will cover the affected crew’s medical and compensation costs. In addition, film insurance will also provide legal defence costs if the crew member decides to sue the production company. To get the best coverage, the insurer should have a list of all crew members, from the cameraperson to the intern.
The bigger the film, the more shooting sites there are, leading to a higher chance of risks. A movie or show can involve many locations and interactions with third parties. Third parties include the public and the property nearby. In most cases, projects need permission and licences to work in specific locations, with the agreement that no third-party person or property will be damaged. As mentioned, things don’t go as planned, sadly.
For example, many projects are now filmed using drones, and as we all know, we cannot fully trust technology. The drone can drop while shooting the location, fall on a random person’s head, and cause bodily injury. The producer or company will be liable for this third-party injury and will have to pay medical costs, compensation settlements or even face a lawsuit.
Film insurance will cover most third-party claims that are related to the project. The insurance will pay for medical, compensation and legal costs to help the production company. The insurance will only cover bodily injuries and property damages during filming.
When Should A Producer Purchase Film Insurance?
Generally, the owner of a production company or the producer running the production purchases the policy. A good film insurance policy effectively covers most of your production needs. Producers never want to be in a case where something goes wrong on set that the insurance doesn’t cover.
Producers or production companies must purchase film insurance before the project begins. Purchasing insurance beforehand allows the project to get the best coverage and avoid possible risks anytime during filming.
Things don’t always go as planned. Filming runs late, equipment gets lost, and, unfortunately, crew members could get injured. These are reasons producers purchase film insurance before each production.