Film Insurance Claims Examples
The average moviegoer only hears about film production insurance when it makes the headlines. After the tragic death of Paul Walker during the filming of Fast & Furious 7 in November 2013, the trade and popular media reported how it led to the largest movie insurance claim in history — reportedly as high as $50 million. High-profile feature films usually buy cast insurance for such rare but catastrophic claims, but all film productions face a host of other risks that don’t usually make the headlines.
Every production is unique and presents its own mix of risk factors, but common risk management issues confront all productions — from large studios with big budgets and sophisticated risk management programs to small indie filmmakers approaching production risk for the first time, from nonprofits creating educational videos to corporations investing in informational videos. The most common insurance claims in production are equipment theft, vehicle damage, damaged locations, and equipment failure in extreme climates.
Here’s a true story: A container of film equipment disappeared while being shipped from Los Angeles to Louisiana. Although no one was aware of what happened to it, the missing container illustrates one of the top film production risks. Equipment is often one of the most valuable assets involved in filmmaking. From cameras to film stock, hard drives, and microphones, production equipment is also quite portable. The risk is complicated by the fact that film sets can be mobile, too, and located in foreign or multiple locations. Workforces made up of contract employees power these productions, adding more risk to this script.
Establishing security on the set is one potential solution for equipment theft. Visible security is especially important in public and international locations, where producers might not be familiar with the locale or confident in the local police. A common security measure is to close and lock doors. Another step to protect equipment is to return it to the rental company each night – though it could be inconvenient, this step leaves the equipment in secure hands.
Damage to a "run-about" — rental vehicles used by production assistants to run errands—are also a common claim on production sets. Production assistants are often younger employees and, due to the nature of their job, they may also tend to be in a hurry on the set. The combination of a more youthful driver and haste could mean that the next scene involves a production assistant colliding with another vehicle.
To help mitigate the risks associated with rental vehicles, consider taking the following steps. Film productions can conduct background checks on all drivers. Safety training might also provide a measure of protection. A third important step is to be familiar with vehicle rental contracts and know who is responsible for property damage and liability if an accident occurs. Although damage to on-set vehicles is rare, it is still an important consideration, particularly when it comes to a "hero vehicle." If the General Lee goes down during Dukes of Hazard or the Batmobile crashes while filming Batman, it will impact production and could lead to an insurance claim. For such vehicles, have backup parts and even a spare vehicle to prevent downtime if an incident occurs. Consider using a mock version during stunts.
Scratch the hardwood floor in a historic home during shooting, and a production — and its insurer — could be looking at $30,000 to replace it. Damage a few vintage light fixtures, and the bill could include the cost to replace every light fixture to ensure they resemble the originals. Film directors make location decisions based on their desired look and feel, but they should be aware their productions could become quite costly if care isn’t taken. The answer is not to sacrifice that look and feel for safety but to instead take precautions. Respect and protect the private homes and other locations where filming is taking place.
Ahead of shooting, film productions should also document a location. Is there pre-existing damage? All parties benefit when knowing exactly what happened if damage is claimed. Doing stunts or pyrotechnics in a location poses its own risks. In this case, calling in loss control experts and engineering specialists, as well as the local fire department, can help ensure stunts are well planned and safe. For instance, such professionals can assist in making sure that any sprinkler system is properly disengaged for a fire-related stunt, and then turned back on when finished.
Faulty Equipment in Extreme Climates
A director filming in a frigid environment wrapped plastic around his cameras. It wasn't to protect them from the cold; rather the plastic casing protected the equipment during breaks from condensation that could form when those cameras were brought inside. Whether in freezing or tropical locations, electronics can suffer water damage and malfunction. These extreme and isolated locations present additional risks as well, as it is unlikely that there will be a film equipment rental facility nearby to obtain replacement gear.
To help prevent the loss of equipment due to climate-related issues and potential production delays, it’s important to protect equipment appropriately. Even when filming in less extreme locations, such as forests or urban areas, productions should be careful to protect equipment from dirt or anything else that could damage it. Productions should test equipment prior to traveling to the set location--try out a camera in a freezer or a sauna, or wherever else best approximates the shoot environment.
Insurance Can Be Value Added
Insurance might be considered a budget line item for some film productions or a requirement from their distributors or financiers, but insurance professionals can also provide a wealth of knowledge and assistance. Productions can contact their insurance companies ahead of shooting, and as partners in the process, the insurer may be able to offer the assistance of risk management and loss control specialists to help establish procedures to avoid costly delays and losses.
Insurance professionals specializing in the film and entertainment industry have seen the above common claims repeatedly — and those headline-grabbing, not-so-common claims as well — and can help mitigate them before and during filming.