Entertainment Property Insurance….Coverage Is King!

Most entertainment business owns business property, and may also own the building in which you run your operations. Entertainment property insurance protects the physical assets of your business, such as computers, office equipment, cameras, film, buildings, furniture, fixtures, and other property.

Every business should have a comprehensive property insurance portfolio to respond to the many risks associated with property ownership. Property policies offer many unique kinds of coverage, some of which we have highlighted:

• Building Coverage - allows you to quickly rebuild or repair buildings or other property damaged by fire, theft, natural disaster or other events, allowing you to return to normal operations.
• Business Personal Property Coverage - covers costs to replace the contents in your building if they are stolen or destroyed by a covered unforeseen event.
• Business Income Coverage - provides for continued income or lost revenues while the building and its contents are being rebuilt and replaced.  Business income helps you to cover operating and normal payroll expenses needed to keep an organization operating after a loss, usually for a specific time period.
• Production Equipment – Covers your cameras, and other production equipment.
• Building Ordinance Coverage - covers the increased cost to comply with building codes, ordinances or laws that have changed after your building was originally constructed. For example, under revised building codes you may now be required to install sprinklers which would increase the value of construction. 
• Outdoor Signs and Property Coverage - covers costs to replace outdoor fences, signs, trees, shrubs or plants.
• Equipment Breakdown Coverage - covers loss due to failure or breakdown of equipment such as boilers, heating systems, and electrical equipment.
• Computer Coverage - covers costs to replace or repair damaged hardware, software, data or media vital to your operations.
• Earthquake Coverage - provides insurance to repair or replace damaged equipment and/or buildings resulting from an earthquake. Earthquake coverage is typically excluded under most property policies.

The staff at John Hart Insurance has over 60 years combined experience in the field of entertainment insurance.  We focus exclusively on understanding the unique needs of motion picture, television, video, music and theatrical companies.  This knowledge base allows us to structure an insurance program specifically for each client that will be a balance of  the best coverage and most economical solutions to help them manage the risks inherent to their unique businesses.

Leased or Rented Equipment For The Entertainment Industry

Like many organizations, your production company may rent or lease equipment from time to time.  There are many reasons why production companies rent equipment. Perhaps you are planning a short term film and need to rent lights or other equipment. Or your management company is sponsoring a concert, and you need to rent a sound system. 

It is important to have an understanding of who is responsible for the rented equipment, and that your understanding is consistent with the written rental agreement. Not all rental agreements are the same. Some rental agreements will include property damage insurance as part of the rental fee. Other rental agreements may require the nonprofit to be responsible for all damage. And finally, some rental agreements may require you to pay a deductible if there is damage. This can be very confusing especially if you are leasing or renting a high value item.

There are many important things to remember when considering a rental agreement:

1. Leasing companies come in many varieties including banks, brokers, equipment specialists, independents, and companies of all sizes.  Each has different levels of flexibility and requirements.

2. Understand what the rental/lease agreement says regarding repairs, maintenance, and upgrades. This applies more to long term leases rather than short term leases.

3. It may be in your best interest to insure the equipment separately. This may be more cost effective depending on how the agreement is written.

Leased or Rented Equipment Insurance

• Coverage is available for a wide variety of property, during production or while in your care, custody and control.

• Property located on or off your premises.

• Property in transit.

• Coverage generally can be provided for risk of direct physical loss.

The bottom line is, when you are deciding to lease equipment, be certain you are aware of all costs involved with the transaction. Then, balance the costs against the benefits to make the appropriate choice for you and your organization.

What Does Property Insurance Cover?

Most of our entertainment clients purchase property insurance. One question we often have is, do clients ever actually read their policies? We hope so. We recommend that every client read their policy and try to understand it. But in case you have not gotten to that, here is an overview of commercial property insurance. Policies will vary, so consider this a brief overview.

The purpose of property insurance for the entertainment industry is to provide financial assistance in the event of a loss (fire, wind, theft) so that the organization can continue to operate with as little disruption as possible.

What is typically covered under a property policy?

• Buildings, furniture, fixtures, inventory, personal property, equipment, cameras, props, sound equipment, etc.

What kinds of losses are covered?

•  Fire, wind, lightning, vehicle damage to the building, weather, theft plus others

What are common exclusions?

•  Earthquake, flood, wear and tear, hurricanes, property not owned by your firm

What are the kinds of coverage needed in the entertainment industry?

•     Property in transit and temporary locations
•          Property for special props and sets
•          Intangible coverage: Includes patents, scripts, copyrights and trademarks
•          Computer virus protection: Covers the loss of data and business through computer viruses
•          Crime and employee dishonesty
•          Business income and extra expense
•          Boiler and machinery coverage

We can examine your current policies to see if you have the coverage you need. Just request an insurance review. An experienced agent will meet with you to go over your policies and explain any details you might not be sure about. As an independent commercial insurance agency we work with a variety of insurers who may be able to provide a quote for your property coverage that could save you money as well.

Why Insure Your Production Equipment For Replacement Cost?

Here is a quick definition of replacement cost coverage; Replacement Cost value is the amount it would cost to repair or replace an item with one of the same kind and quality as the original — in today’s market.

Replacement Cost Coverage usually reimburses you for the full cost of replacing the items you lose, rather than simply reimbursing you for the value of the item at the time it was lost. In other words, your insurance policy would pay what it would cost to go out to a store and purchase the item today.

From theatrical costumes, sets, to musical instruments, amplifiers and sound boards, from cameras, video equipment, and computers to custom-made puppets –equipment is an integral part of the entertainment an integral part of the entertainment business.

Having replacement cost coverage will allow you to continue operations after a loss with the least amount of disruption.