Production Insurance 101: What You Need For Your Commercial
The reality of working on your upcoming production is accepting that things don’t always go as planned. Shoots get delayed, equipment breaks, and there’s always the risk of someone getting injured on set. For this reason, getting your production insured will guarantee a safety net for your company and your cast and crew.
Production insurance is an important part of any commercial production as it can help to protect you from financial losses during the production process. Deciding which production insurance is right for your upcoming project will vary on the nature of your commercial.
If you are planning to produce a commercial, it is important to understand about the different types of production insurance that are available and which ones are right for your project.
In this blog, we’ll cover everything there is to know about production insurance and some useful tips to help guide you down the right direction.
What is Production Insurance?
Production insurance is instrumental for a successful production as it protects your company from liabilities. Given the individuality of film productions, there are various types of film policies designed to protect the specific needs for your upcoming production.
Being prepared for unexpected bumps during pre-production, production and post with a strong production insurance will reduce the chance of it impacting the success of your project.
Another reason production insurance is important is the fact that most vendors will ask for proof of insurance before moving forward with your production. No insurance… no production.
Key Components of Production Insurance
Production insurance is a combination of different insurance policies such as wraparound policies, general liability, workers compensation, errors and omissions, additional coverage options and more.
Here we list and explain each type of insurance and their benefits.
Wraparound Insurance Policies
Wraparound insurance is for bigger productions consisting of advertising agencies covering third party production companies for contracted projects within. They cover pre production, production (shoot) and post production.
Worker’s Compensation Insurance
For any physical accidents or sickness that may occur during production, worker’s compensation is available to secure your production and protect your employees.
Worker’s compensation covers medical expenses, lost wages and further treatment costs for any injuries that occurred while on set. This insurance allows the injured employee to recover while still receiving their benefits and pay and your production avoids the added medical costs - win, win for both parties.
General Liability Insurance
General liability applies to productions within the US and Canada and serves to protect your production from any trips or falls such as financial or legal risks for any physical injury or property damages to third party workers.
In sum, general liability covers:
General Aggregate
Products and Completed Operations Aggregate
Limit Each Occurance
Fire Damage Legal Liability
Medical Expense
Notice / Knowledge of Occurrence
Blanket Additional Insured Endorsement
Limited Worldwide Liability
Contractual Liability
Employees as additional insureds
Director Loan Out Corporations
Production Equipment Insurance
If you experience damage, theft or loss on set, production equipment insurance has you covered. Equipment covered under this insurance includes:
Management software
Production office equipment
Cameras
Camera accessories
Lighting equipment
Microphones
Editing keyboards
Headphones
Computers
Editing software
Production insurance also covers reshoots if equipment trouble causes production delays.
The best production insurance policy is the one that will cover the most for your equipment under any situation such as earthquakes, floods, smoke and water damages and more.
Errors and Omissions (E&O) Insurance
After your commercial has been released, your production is still at risk for lawsuit or copyright infringement. This type of coverage is generally provided by the ad agency or brand contracting with the production company.
Even the most careful producer can face a lawsuit for defamation, invasion of privacy, unauthorized use of names, piracy and story theft. The Errors and Omissions (E&O) insurance protects your commercial from libel, slander, defamation, unauthorized use of product, plagiarism and other losses related to intellectual property.
These policies protect your commercial usually for up to 3 years from any legal challenges after it’s been released.
Additional Coverage Options
For special projects there are special insurance policies to ensure they are being protected all the way. Add-on specialty policies covers various types of features for productions such as:
Animals
Automobiles
Drones / Aircraft
Stunts
Props
Weapons
Sets
Props
Special effects
Post Production
When adding specialty policies to your insurance it is always best to be upfront on the special elements you’d like covered to create the right policy for you.
Determining Your Commercial’s Insurance Needs
Now, which production insurance is right for your commercial? The ideal production insurance is one that can cover most if not all your production needs. When navigating insurances, you should keep in mind the following:
Project scope:
Does your project have any special elements?
What equipment will be used for this project?
How long will your project take to produce?
Budget:
Your insurance will run about 2.5% or less of your total production costs .
If there is a large agency or brand involved, most likely they will be providing the insurance .
The right policy is the one that will keep you covered. Speaking with entertainment brokers that understand how to navigate production insurance for your projects can ensure you’re protected now and in the future.
Worker’s compensation coverage is part of the “fringe” rate charged by entertainment payroll services and is included as part of their services.
Tips for Choosing the Right Production Insurance Broker
Only a skilled and experienced broker can help navigate your production to the right film insurances you need to keep your company secured. When deciding which production insurance provider is right for you, here are some useful tips to picking the right service provider.
Researching and comparing providers
When researching film insurance broker you should consider the following:
What type of projects do they specialize services for?
What is the minimum film budget they need to cover your production?
What coverage do they offer?
What areas/locations do they cover?
What is their claims process?
Understand policy terms and conditions
Depending on the type of insurance policies your production requires, you’ll favor the payroll service provider that specializes in knowledge and expertise within your insurance.
For example, RVNA Production Insurance specializes in DICE insurance policies and short term production insurance while MovieInsure specializes in short term and long term production insurance.
Navigating Claims and Losses
The immediate reaction to a film production insurance claim is instant stress but it doesn’t have to be. Claims are bound to happen and knowing how to address these claims as soon as possible will ensure you get back on track for production. Here are some of the most common reasons claims are filed:
Cast claims: An actor gets sick on set will now require recovery time causing shooting to be pushed back.
Production insurance claim: From bad technology causing you to lose significant data loss to your equipment getting damaged or stolen.
Steps to take when a loss occurs
No matter what type of loss, here are the steps you should take when a loss occurs:
Protect your property: Make sure you take the necessary steps to prevent further damage to our property.
Photograph and record the damaged property: Thorough documentation, records and photos will make the difference of a quick settlement.
Report the loss: Contact your insurance broker or agent and report the loss.
Start a papertrail: Request copies of reports for your documentation such as police reports and reports from the fire department.
Communicate: Communicate often with your insurance provider to stay on top of claim updates and processes.
Conclusion: Streamline the Back Office Functions of Your Commercial
In conclusion, production insurance is here to secure your company and shield your employees. By understanding the basics of production insurance and the different types of coverage available, you can protect yourself and your production from financial losses.
If you're in need of production insurance and more back office production support, here at CMS Productions, we have a talented team with years of experience providing all in one production support services.
Contact us today to see how we can help streamline your upcoming commercial production.
