All Audio/Visual production involves a number of specific risks and unforeseen difficulties. Insurance can be obtained in respect of certain risks in an amount sufficient to meet any reasonably foreseeable claim; however, all insurance is limited in nature and in amount.
Insurance may be obtained by the Corporation in respect of its A/V production, and it will likely be required by investors, distributors and otherw with a financial stake in the production, sufficient to reduce or eliminate such risks. Insurance is usually purchased to cover the following risks:
1. Loss or destruction of the Master Tape, Recording, Hard Drive;
2. Death, Injury or Illness in respect of one Lead Cast and the Director;
3. Faulty Camera and Recording Medium;
4. Loss or destruction of Props, Sets and Wardrobe;
5. Loss or destruction of Miscellaneous Equipment;
6. Third Party Property Damage;
7. Comprehensive General Liability; and
8. Producer’s Errors and Omissions.
Coverage for these items generally are obtained just prior to commencement of principal photography.
RISK MANAGEMENT – Completion Guarantor
A Completion Guarantor issues a Completion Bond which guarantees to a producer, and more importantly, the investors, distributors and others with a financial interest in the A/V product that production will be completed on time and on budget. The cost of the Completion Bond is a line item in the production budget but often subject to a bonus payable to the production company as a reward if the producer brings the production in on time and budget. Should the production fall behind or go over budget during production or post production, the Guarantor may take the production duties away from the producer and use its own personnel to complete the production on time and budget. In such a case, the Completion Guarantor guarantees the technical quality of the A/V product but not its aesthetic quality.