Film Producer's E&O also protects against alleged libel, slander, defamation of character or invasion of privacy. A distributor, broadcaster or financier will usually require this coverage prior to the release of any theatrical or television production; i.e., production financing will usually not flow until E&O coverage is in force.
Producers E&O Insurance
A producer will need to complete an application and obtain a clearance report. If coverage is required for the title, you must obtain a ‘Title Report & Opinion' from a recognized Title Clearance Company offering this service and submit the report to underwriters for final approval.
Premiums for E&O vary based on the content of the production: a straightforward documentary typically costs $3,000 to $4,000 and $6,500 to $8,000 for a feature film for the industry standard 3-5 year policy term. (Pricing subject to change) Every project is unique and requires a custom E&O policy.
Upon instructions from the Production Company, the broker will begin the clearance process. The lawyer for the underwriter will review and approve the clearances done by the producer’s lawyer. The fee for the insurance company lawyer’s service is included in the final premium. If coverage is not bound, the insurance company clearance fee (approximately $600) is payable and an invoice will be issued accordingly.
Check your production/distribution/financing agreements regarding the start date for Errors & Omissions coverage. Some financiers require E&O coverage to be in place for the first day of principle photography before they will release payment to the producer.
It can take up to 10 working days for a project to be cleared and coverage to be in place, so start early to ensure that your cash flow is not impacted.
The E&O policy will provide defense costs if the producer is sued and will pay the judgment costs if the producer is found liable. Until a lawsuit happens, it provides peace of mind.