Search

Why Hollywood Is Facing a COVID-19 Insurance Crisis - Variety

ureturet.blogspot.com

Rana Joy Glickman has produced lots of independent films over the last 20 years. But on her latest project, “The Blazing World,” she did something she had never done before: she did not buy cast insurance.

Ordinarily, it’s an essential item. Without it, a production could face a total loss if the director or principal actor gets sick or dies during filming. But in the era of COVID-19, such insurance is extremely expensive — if it’s available at all.

“That definitely came with a certain degree of anxiety,” Glickman says. “But there are so few guarantees about anything in the independent film world.”

In her case, it worked out. The film shot for a month in Dripping Springs, Texas, and nobody got sick. Glickman also had financiers who were willing to take the risk.

But many productions are struggling to figure out what to do. Commercial banks are not providing completion bonds without insurance, and traditional insurers aren’t willing to cover losses from COVID-19. Many projects have simply collapsed, while others are exploring outside-the-box solutions.

“Things are challenging because the old ways don’t work,” says Kent Hamilton, president of Front Row Insurance. “Some people in some cases are taking the risk — they’ve just gone for it.”

Other Front Row clients have bought a policy from Elite Risk, a new entrant in the film and TV insurance marketplace. The owner, Jeff Kleid, has specialized in offering crop insurance to cannabis growers. After the Mandalay Bay shooting in Las Vegas, he sold “active shooter” policies.

Now, Kleid is offering film and TV production insurance that covers COVID-19. The policies come with low coverage limits — generally around $3 million, maximum — and high premiums, about 10% of the coverage amount. That’s many times more than productions are used to paying.

“Ours is a small solution,” Kleid says. “We’re not looking to be the solution for everybody. We’re looking to get a few people back to work.”

Brad Krevoy, producer of the Hallmark Channel series “When Calls the Heart” and a series of holiday films for Netflix, has bought Elite Risk policies for some productions in Canada. The film projects have modest budgets — less than $5 million — and Canada has a strict 14-day isolation period for cast and crew entering the country.

“It’s a good system,” Krevoy says. “We’re busier than we’ve ever been.”

Arthur J. Gallagher & Co., one of the leading brokers of film and TV insurance, is working with SpottedRisk, another wholesale underwriter of specialty products. Spotted started a few years ago analyzing data to advise brands on celebrity endorsement deals. In the wake of the #MeToo movement, the firm pivoted to offer “disgrace insurance,” in which it used its data to try to predict the likelihood of a scandal.

Spotted is now offering cast insurance for COVID-19 and “civil authority” coverage — which pays out in the event of a government-ordered shutdown. CEO Janet Comenos says the policy limits have ranged from $8.1 million to $41 million — with a premium of 7-10% of the coverage limit. The firm acts as a wholesaler, selling coverage on behalf of Lloyd’s of London and other carriers.

Both Elite Risk and Spotted have very limited capacity. Elite has insured 15 projects so far, while Spotted has done four projects. Both are seeking to get further backing, which would allow them to write more policies.

“The demand is far outweighing the supply,” Comenos says.

Elite is a wholesaler on behalf of a captive insurance company, which Kleid declined to identify but which others in the industry identified as Ottawa Corporate Ltd., based in North Carolina. Ottawa is licensed by the state’s Department of Insurance, which confirmed via email that the company has met its licensing requirements, which include submitting a business plan and financial statements. As a captive — essentially a privately held, alternative insurer — the firm is not required to make its statements public, and is not covered by the industry’s independent rating system.

“A captive is only as good as its financial stability,” says Brian Kingman, managing director of the entertainment practice at Arthur J. Gallagher. “It’s not as transparent. So that’s a question mark.”

Comenos, CEO of Spotted, said she found Elite Risk’s business model “upsetting.”

“It’s really critical with new and emerging risks that the insurance is written on A-rated paper, and that’s not the case for them,” she said. “Their paper is unrated.”

In response, Kleid says that he has been in regular contact with the state regulators, adjusting its projections as needed, but that the firm is still well within its risk capacity.

“My name is solid in the film and TV industry,” Kleid says. “The product we’re offering is new, but the people they’re buying from have a trust factor, and that’s me.”

Kleid also notes that he has 25 years of experience in the insurance industry, which Spotted does not.

“SpottedRisk is a technology company that came up with a solution for figuring out how to price things,” Kleid says. “They’ve hunkered down on the entertainment space and have been able to get attention… But everything they’ve learned in their model, there’s no way to quantify that data. You should go with who you trust. We’ve got to do it one policy at a time.”

Kingman, of Arthur J. Gallagher, says it is disappointing that two firms are “badmouthing each other.” He says he’s working with both companies to try to get the price down and find a product that will help clients.

“There’s enough room in the marketplace for two,” he says. “They’re both facilities that are trying to fill a void in a much-needed market. We’re trying to build each of them up and make sure they are operating to our expectations.”

Let's block ads! (Why?)



"Hollywood" - Google News
September 16, 2020 at 04:21AM
https://ift.tt/35D9EC3

Why Hollywood Is Facing a COVID-19 Insurance Crisis - Variety
"Hollywood" - Google News
https://ift.tt/38iWBEK
Shoes Man Tutorial
Pos News Update
Meme Update
Korean Entertainment News
Japan News Update

Bagikan Berita Ini

0 Response to "Why Hollywood Is Facing a COVID-19 Insurance Crisis - Variety"

Post a Comment

Powered by Blogger.