A Break Down of Film Production Insurance and How to Get It
Film production is a massive undertaking with an army of people at the helm of it.
When there’s so much at stake, it’s a good idea to get insured.
Getting adequate film production insurance will allow you to meet legal obligations and ensure that your project runs smoothly.
Why is production insurance necessary?
Production insurance may seem like an additional expense, but most filmmakers agree that proper coverage is worth it because it secures your cast, crew, equipment, and protects you from legal claims.
Additionally, having the right sort of coverage is important when it comes to securing filming permits, locking in locations, and hiring actors.
Take SAG-AFTRA for instance, they now require new media producers to have a general liability insurance policy and worker’s compensation for hiring union actors.
Credits: SAG-AFTRA
How much will production insurance cost?
The answer to this question will vary based on several factors:
your insurance provider;
the policies you choose;
size of production;
length of production
the number of projects you have lined up; and
risks involved in production (such as stunts).
Since there are a lot of variables when it comes to production insurance, it’s hard to come up with a specific number. But for budgeting purposes, you can expect to shell out around $1650.
For this price, you’ll get $1,000,000 of general liability and $1,000,000 of workers’ compensation coverage. The general liability will cover you for 12 days and workers’ compensation will have you sorted for 60 days.
Of course, if you need longer coverage, policy prices will go up.
Next, we’ll talk about the different types of production insurance available so you can decide which policies are right for you.
Types of production insurance
Annual production insurance
Short term insurance
Workers’ compensation
Cast extra expense
DICE insurance
General liability insurance
Third-party property damage
Errors & omission (E & O) insurance
Employment practices liability Insurance (EPLI)
Equipment insurance
Umbrella liability
Production insurance package
Annual production insurance
If you have multiple projects lined up for the year, then annual production insurance is the best bet for you.
A policy like this is perfect for film production companies.
Short term insurance
If you’re working on a single project that will wrap up in just a few days, then a short-term production insurance policy will suffice.
Workers’ compensation
Laws in several states require that employers purchase workers’ compensation insurance policies for their employees.
The policy ensures that employees receive a payment if they get injured on the job regardless of whose fault it was. Chronic problems and long-term illnesses are also covered.
Cast extra expense
If a key cast member gets seriously sick, injured, or has to leave due to a family emergency, you’d have to shut down production until they return. And in case of death, you’d have to shut production down permanently.
Cast extra expense is for these particular scenarios and can cover your company from some hefty expenses.
To get this policy, you need to make a list of your key cast and crew members and have them complete a medical exam. Once they pass a routine physical, they’ll be eligible for coverage.
This coverage starts with a deductible as low as $2,500.
Note that workers compensation covers your employees’ expenses while cast extra expense covers yours.
DICE insurance
DICE stands for documentary, industrial, commercial, and educational films. DICE insurance also covers short films, feature films, music videos, and more.
If your production company works on multiple projects annually and even concurrently, then this type of coverage could be right for you.
General liability insurance
General liability insurance covers bodily injuries and property damage to third parties.
You’ll need this coverage if you want to get filming permits, lock in locations, and hire SAG actors.
To clarify, this policy does not cover people who work for you or locations where you are shooting at.
Third-party property damage
The third-party property damage policy covers damage done to locations that are under your custody or control.
Errors & omission (E & O) insurance
So far, we haven’t talked about coverage for less tangible claims, such as libel and copyright infringement. For insurance against such claims, an E & O policy offers adequate protection.
You’re also going to need an E & O policy to establish a distribution network for your film
Here’s what this type of insurance protects you against:
Infringement of copyright
Invasion of privacy
Plagiarism
Libel or slander
Employment practices liability Insurance (EPLI)
An EPLI has a very specific purpose. It covers the legal cost and damages awarded in court when a worker claims that their legal rights have been violated.
So, for example, if your production company has to face sexual harassment and invasion of privacy lawsuits, an EPLI will have you covered.
Equipment insurance
Typically, an equipment insurance policy will protect you from damage and/or theft of equipment.
Your policy cost will depend on the type of equipment covered.
Most policies cover equipment used in all stages of production.
Umbrella liability
An umbrella liability policy provides extra coverage and sits on top of the general liability policy. Both these policies are purchased in combination.
For example, if you got a million-dollar general liability policy and a 4-million-dollar umbrella policy, you’d have a combined limit of 5 million in liability.
The umbrella policy provides an extra layer of coverage in case your general liability coverage is exhausted in the event of a loss.
Production insurance package
When you look for film production insurance, you’ll need to find the right combination of policies that suit your particular needs.
An entertainment production insurance broker will help design a package so you’re equipped with exactly what you need.
The next section will cover brokers in detail.
Generally, a production insurance package should cover the following:
General liability insurance
Workers’ compensation
Errors & Omissions insurance
Equipment insurance
How to get film production insurance?
We covered several different types of production insurances. Once you have a general idea of what’s out there, we recommend contacting an entertainment production insurance broker.
Your broker will identify risks that are unique to your production, contact several insurance companies, and help you secure relevant insurance policies with the broadest coverage and lowest possible premium.
If you’d like to look up some entertainment production companies on your own, you could check out these:
Pro tips:
While hunting for entertainment insurance policies, get at least three quotes.
Once you’re insured, get a certificate of insurance (COI). This is a document that proves to others that you have insurance.
The importance of an entertainment insurance broker
Here’s how your broker will help you navigate the realm of entertainment:
Serve as a liaison between you and the insurance company.
Negotiate packages and premiums with the insurance companies on your behalf.
Advise you on ways to minimize potential liabilities during production.
Help you acquire certificates for banks, locations, and rental companies to prove you’re covered.
Review your existing insurance policies and advise if additional coverage is required.
Help you understand the limits to the coverage you have.
Production insurance during COVID-19
The entertainment industry has suffered a massive blow because of COVID-19.
And the worst part is that insurance doesn’t cover a virus. So, if production had to shut down because of COVID-19, the money lost could not be recovered.
And as far as employee health is concerned, you might think that workers’ compensation will cover your cast and crew for sickness, but that may not be the case.
Your workers’ compensation claim could be denied if the following conditions are not met
The disease or illness must have arisen out of and in the course and scope of employment.
The illness and/or disease must arise out of or be caused by conditions that are peculiar and unique to the work itself.
The problem is that it would be difficult to argue that COVID-19 is unique to the entertainment industry. It would also be hard to create direct causation of the illness to the work itself. On these grounds, claims can be denied.
To make sure your employees are protected, we recommend an alternative, such as health insurance.
Lastly, if all of this is a bit overwhelming, contact Revolution. We’ll offer guidance on how to secure the right sort of insurance for your production.
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