In a world screaming out for fast content, producers need the right kind of protection

The COVID-19 pandemic has decimated countless sectors – from hospitality and leisure to theatre and live music. It’s even managed to have a major impact on industries that were thought to be nearly bulletproof – the film and TV industries.

But how has this most heinous of hurdles managed to impact the sector directly and what are the insurance implications?

While shooting new material for film and TV may be severely restricted, audiences, and crying out for new content. There’s an opportunity for production companies to dig out archive material and work that was already in the can. But in the rush to distribute fresh content, it’s vital to make sure you have secure insurance in place.

Production insurance is big business. It’s been estimated that all production studios paid over $400 million in insurance premiums in 2019 alone to the three largest entertainment insurance companies and in most cases, every risk is covered – unless it’s been specifically excluded.

Everybody’s watching

Production on all films and tv shows was halted over the lockdown period, with even long-running soaps and major Hollywood films placed in stasis ‘until further notice’ (quite ironic – given that so many of us have dealt with the monotony of lockdown by bingeing Netflix box sets).

This all means major lost revenue because of delayed production times, not to mention advertising revenue and lost box office takings due to all the closed or compromised cinemas.

Whilst the US wasn’t placed into such a strict lockdown, even in Los Angeles, the epicentre of film and TV production, on-location filming is down almost 20% since the pandemic outbreak –  and in the UK the situation is even bleaker.

The immediate reaction has been for production companies to act fast – creating reactionary content that’s light on staff and heavy on spontaneity –  quick, simple content that requires very little planning. But in all that speed and bluster you could end up missing out something quite important – the insurance.

While commercial producers’ indemnity may be taking a back seat under the restricted creative environment, distribution carries a whole different set of risks.

Film Errors & Omissions insurance is designed to give financial protection for production companies during the distribution of their content – and most distribution contracts require you have it in place.

As far as COVID is concerned, most production policies contain a ‘due diligence clause’ and COVID-19 claims would typically fall under that clause.

However, before February 2020, it’s unlikely that disruption of production due to a communicable disease would have been excluded but we live in a different world now.

COVID-19 might be the seventh epidemic of the 21st century but it is comfortably the most disruptive and it’s worth noting that even during the SARS outbreak, insurance companies began issuing exclusions within weeks.

This is one of the many reasons why production companies are simply not taking any risks with COVID at the moment and this has led to studios rushing out ‘in the can’ content without taking the proper risks and taking out film errors and omissions insurance.

What is film errors and omissions insurance?

It’s an insurance policy custom-made for producers that covers them for a variety of potential risks.

For example, if in your haste to put out a new piece of content you accidentally use something that infringes on somebody else’s copyright? Or maybe in that same haste you use information you later find out to be untrue or defamatory or omit certain titles and credits that had been promised during production?

We all make mistakes and in this climate where the film and TV world is scrambling to make something out of nothing, mistakes are bound to be more common.

Film E&O insurance is precisely the kind of cover you need right now if you’re producing any kind of visual content.

So if you represent a production company, get in touch with La Playa today to learn more.

Image: ponsulak / Shutterstock.com