The film industry will soon reopen with more guidance than any other sector. One of the most important and discussed aspects of this is film insurance. Be it Ad-films, Commercials, Movies, or any related events, production houses/companies or the producers will be responsible for insuring their movies or ads.
Whether you believe it or not, the number of things that can be insured is increasing day by day. Beyond the usual insurance issues such as automobiles, property, health and life, there are other unknowns, such as body parts, satellites, and actors ’lives. These rare insurance items include film. Typically, the bigger the movie, the larger the amount will be insured. In fact, Baahubali 2: The Conclusion is one of the most expensive Indian films ever made. Producer insured the film for Rs 200 crore!
The insurer claims that the policy cinema has been insured against unforeseen events, such as the death of an actor, the death of a crew member, accidental damage, or natural disasters that could cause a delay in the film's schedule. Film insurance also covers equipment damage caused by accidents during the shooting. The terms of a film insurance policy vary from one film to another. To understand how this type of insurance scheme works, let’s start with the basics.
What is Film Insurance?
To be clear, in many ways, a film insurance policy is like a health insurance policy. To better understand this, consider a health insurance plan that provides insurance coverage against any unforeseen health problems, illnesses, or accidents. Just like a medical insurance plan that helps cover the cost of certain illnesses, or offers a lump sum to the individual, a film insurance plan protects the production company from unexpected losses, either in part or at all costs involved. Offering a huge amount of money to handle unforeseen accidents or disasters.
Why do you need Film Insurance?
Filmmaking is a complex process where many departments work together. External factors, such as a wide variety of locations, heavy equipment, unpredictable delays, and the risk of a variety of accidents. For producers who finance big budget movies, any of these factors can cause sudden, uncontrollable losses. Getting insurance coverage helps mitigate some of the risks.
What are the benefits of having insurance coverage for a movie?
An insurance policy provides three types of protection for film production companies - property, legal and contractual.
Property protection protects the company from loss or damage to assets such as cameras or lighting equipment. These tools are usually rented from a rental company and the manufacturer is responsible for them according to the terms of the lease agreement.
Legal protection covers physical liability, total liability for workers involved in film making, damage to property at the shooting site, or any other unforeseen accident or damage that may affect parties involved in legal contracts signed by the production company.
Contract protection means that film insurance helps film production companies to fulfill the closing of contracts signed with a film distributor, which requires the film to be insured. Additional suppliers, including this option, are involved in the agreements they make with filmmakers.
Before Baahubali made headlines for its substantial insurance coverage, most filmmakers were generally not cautious or wanted to get insurance coverage for their films. However, in recent years, the situation has been changing rapidly, with producers and production companies increasingly coming to terms with the idea that their films should be adequately insured from the outset of the filmmaking schedule. If the current trend continues, the day will not be far off as almost all manufacturers are trying to secure their projects, thus opening up new avenues in the insurance market in India.