Safeguarding Film and Television Productions

July 17, 2023

For production professionals in the entertainment industry, film and television projects rarely run as smoothly as the finished product may appear on screen. To hedge bets against costly production delays and inherent risks—including equipment damage, injuries, and intellectual property issues—production insurance is essential. In this article, we explore some of the common risks within the film and television production industry and the coverages designed to protect against them.

For more information on entertainment insurance, visit our Take1 Insurance page.

Common Risks in Film and Television Productions

Film and television production involve numerous risks, both predictable and unpredictable. Here are some of most common risks encountered by production companies:

• Budget Overruns: This is one of the most common risks, as the production costs can easily exceed the planned budget due to unforeseen circumstances, such as delays, reshoots, and technical issues.
• Scheduling Delays: These can occur due to a variety of reasons, including bad weather, actor availability, equipment failure, or logistical problems. Delays can increase costs and potentially impact the release date.
• Cast and Crew Health and Safety: Accidents, illnesses, and injuries on set can lead to major delays and legal liabilities. This was highlighted during the COVID-19 pandemic, with productions needing to ensure they met health and safety guidelines.
• Technical Malfunctions: Equipment can fail, digital files can become corrupted, and other unforeseen technical issues can occur. This can lead to costly reshoots or repairs.
• Creative Differences: Disagreements among directors, writers, producers and other creative team members can lead to delays, reshoots, or personnel changes, which can be costly and disrupt production.
• Legal Issues: This can include disputes over intellectual property rights, copyright infringement, or lawsuits related to incidents on set.
• Distribution Issues: Changes in the marketplace can impact a project’s distribution strategy and success. This could include changes in technology, viewer preferences, or competitive releases.
• Market Failure: Despite all efforts, a show or film can fail to attract its intended audience, leading to poor box office sales or low viewing figures.
• Environment and Weather Risks: Productions, especially those on location, are at the mercy of weather and environmental conditions. Natural disasters, bad weather, or local political instability can disrupt shooting schedules.
• Post-production Issues: Post-production, including editing, visual effects, and scoring, can reveal issues not previously detected. Corrections can be time-consuming and expensive.

Each of these risks represents the potential for devastating financial losses, including legal claims arising from property or equipment damage and injuries to crew members or cast. While many of these risks can be mitigated through planning and training, production companies are often at the mercy of factors outside their control.

How Can Production Companies Protect Themselves Against Risks?

Film and television production companies employ a variety of strategies and precautions to protect against losses. Here are some of the strategies used to minimize or avoid risks:

• Contracts: Well-drafted contracts are crucial to minimize legal risks. This includes contracts with talent, crew, producers, and other parties involved in the production.
• Budgeting and Scheduling: Careful and realistic budgeting and scheduling can minimize the risk of cost and time overruns. This includes contingencies for potential issues that might arise during production.
• Safety Protocols: Implementing and enforcing health and safety protocols on set can minimize the risk of accidents, injuries, and illnesses.
• Risk Assessments: Carrying out risk assessments, particularly for on-location shoots, can help to identify potential hazards in advance and take preventive measures.
• Quality Control: Maintaining high production standards and ensuring quality control at all stages can help to prevent costly mistakes and re-shoots.
• Market Research: Conducting thorough market research can provide insights into potential audience preferences and trends, helping to shape the production and marketing strategy.
• Diversification: By diversifying their portfolio of productions, companies can spread their risk. If one film or TV show fails, others may succeed.
• Secure Distribution Agreements: By securing distribution agreements in advance, production companies can ensure that their film or television show will be aired and potentially earn revenue.
• Post-production Checks: Rigorous checks during post-production can help catch any issues before release, minimizing the risk of costly post-release fixes.
• Legal Counsel: Having a good legal team can help companies navigate complex legal matters, minimizing the risk of lawsuits and other legal issues.

By employing these strategies and others, film and television production companies can mitigate potential risks and protect against losses.

Next, we present the most valuable risk protection strategy not mentioned in the above list – that of film and television production insurance.

Insurance Coverages for the Film and Television Industry

Film production insurance is the leading solution to protect against the risks associated with entertainment projects before, during, and after production. While policies may vary in their coverages and scope, common elements of insurance policies typically include:

• Equipment Coverage: Covers rented or owned equipment used on set and after filming wraps. This coverage typically protects equipment from theft, damage, or loss.
• General Liability Coverage: Covers third-party bodily injury and property damage on production premises and shooting locations.
• Errors & Omissions (E&O) Coverage: Covers financial losses associated with violations of intellectual property (IP) laws, including slander, plagiarism, defamation of character, unauthorized use of product, and libel.
• Workers’ Compensation Coverage: Typically required by state and federal regulations, this coverage offers reimbursement for medical expenses and lost wages resulting from crew/cast injuries occurring on set.
• Short-Term or Annual Production Coverage: Policies that cover a single production or all of a company’s productions in a calendar year, respectively.

For certain television and film productions, specialty add-on coverages may be used to protect against the losses associated with stunts, animals, pyrotechnics, or other aspects of production that may fall outside “normal” on-set activities. ◼