Distributor's Errors and Omissions (E&O) Insurance
Much like the producer's E&O insurance, the distributor's E&O insurance covers distributors from lawsuits that may arise due to the content of the material they are distributing.
Distributor's E&O insurance differs from producer's E&O in that distributors are insured for a list of titles they are distributing. In order to add a production to a distributors E&O policy a minimum of one year of E&O policy needs to have been in force. For each film that you distribute, you will need to ask for evidence of previous e&o coverage.
The premium is determined by the estimated annual revenue that is expect from the list of titles to be insured. A deposit premium is paid and then the deposit is adjusted at the end of the policy year based on actual distribution revenue. A distributor's policy is typically much less expensive as compared to extending individual E&O policies. The adjustment rate is usually 10 cents per $1000 of revenue.
To get a quote, we will need to have an application completed and we will need a list of the titles to be covered.
WHY E&O POLICIES ARE NEEDED?
- I.e., The script of your movie/show is slightly similar to another production, therefore a claim for plagiarism could arise.
- Covers the insured against defamation, libel and slander suits.
- Covers against intellectual property rights.
- Typically most distributors and broadcasters will not distribute or air any production without it.
- It protects a company or individual from financial loss.
TYPICAL E&O CLAIM SCENARIOS
- An action brought against a production company for the production of a movie which is similar to events depicted in a novel.
- A defamation/slander suit brought against a production company based on a recognizable likeness between a fictional character in a tv series and an actual person.
- A production company is sued for unauthorized use of titles and/or music/stock footage, for not acknowledging underlying works such as books, scripts of screenplays or for not requesting permission to acquire rights.
E&O Insurance 101 & How to Protect Your Film Project
Are you paying for the coverage you need?
Distributor Errors and Omissions
How much of your film is copyright-able?
To get or not get permission: The Social Network
A production lawyer's guide to obtaining E&O insurance and preventing litigation