The box jellyfish is one of the world’s deadliest creatures. With tentacles up to three metres long and venom that attacks the skin, the heart and the nervous system, swimmers that are unlucky enough to be stung often never make it back to the shore. Drowned after going into shock, or dead of heart failure.

With experience as a former teenage backpacker in the area, Mooneys Insurance Brokers managing director David Mansley was well aware of the dangers faced by those brave – or stupid – enough to venture into the water along the Northern Queensland coastline during stinging season, which was why alarm bells rang when the production team behind shark thriller The Reef planned to do just that.

“There’s no way they could have shot where they were proposing to shoot,” he says.

Thankfully, co-producer Tiare Tomaszewski had contacted the insurance broker in the very early stages of the production – although locations had been planned, nothing had been officially booked. The production ended up shooting hundreds of kilometres south of where they had originally intended. The Reef’s predator remained a hungry shark instead of a wayward jellyfish. Crisis averted.

In the film and TV industry, where unpredictability is often the rule rather than the exception and the best laid plans often fall through, insurance is a necessary precaution.

“People say you’ve always got to have a Plan B,” says Mansley. “But the film industry has Plans B, C, D, E, F, G, H.” Purchasing insurance is, as Mansley puts it, buying a cheque to cover things that could go wrong.

For The Reef, this involved providing coverage for film equipment that could be damaged by water exposure (the film spent four-and-a-half weeks shooting on the ocean), the potential hazard of sharp rocks, stonefish, and, yes, box jellyfish.

Brokers often join a production at the very beginning of development, as most policies need to be in place prior to pre-production. Shooting schedules and equipment use are evaluated, scripts are examined and risk management plans drawn up surrounding any proposed stunts.

“We prefer to get involved in the embryonic stage,” says Mansley, who is also working with Blackfella Films on ABC telemovie Mabo. “Insurance is a fairly substantial spend in the budget. We have to help the producers figure out how much they’re going to spend.”

While this works well for features and series that get the green light, many never make it to our screens – and there’s no insurance for insurers whose work never comes to fruition.

“One of the major issues facing the film industry is obtaining finance,” says Midland Insurance senior account executive, Brian Holland. “We do a lot of work in preparing preliminary quotations and some of these projects never see the light of day. That’s the nature of the beast, we just have to grin and bear it.”

Midland Insurance has worked on two big films that have graced our screens this year: Simon Wincer’s The Cup and Justin Kurzel’s Snowtown. According to Holland, both features had “issues peculiar to those productions”.

The Cup, which tells the true story of Damien Oliver’s 2002 Melbourne Cup victory, took out a package policy that consisted of negative film risk, equipment insurance, money, public liability and film producer’s indemnity. Of these covers, the latter two were deemed the most important. Under the film producer’s indemnity, key members of the cast and crew are covered in the event of any expenditure that may occur as a result of death or injury during principal photography. In The Cup, three of those cast members were horses.

With the film shooting at various race courses and football fields, where cast and crew liaised with contractors and members of the public not involved in the production, public liability insurance was also a priority.

According to Aon Australia senior account executive, Peter Sun, public liability is the main concern underpinning the industry as a whole. Almost 40 per cent of film and TV claims reported to Aon fall under this category. The company has recently worked on TV series including Hamish & Andy’s Gap Year and The Amazing Race Australia.

The public liability policy covers the insured party (which, on a film, is the production company) in the event of personal injury or property damage as a result of being exposed to risks on set. It is similar to third party insurance, rather than workers’ compensation.

Contractors involved in the film are considered separate legal entities and must have their own cover. Confused? It seems most people are. Mansley admits he spends at least one-third of his time explaining to production companies who is and isn’t covered by public liability insurance.

“Contractors simply don’t realise that they aren’t covered and assume that an umbrella insurance policy is in existence somewhere that covers them automatically,” says Sun. “In reality, they’re on their own and responsible for looking after their own professional interests.”

Equally as vital as public liability cover, but with a lower chance of being claimed upon, is the Errors & Omissions policy (E&O). This cover provides indemnity for any lawsuits launched against the production company that concern breach of copyright, defamation, plagiarism, libel or slander.

“It’s a very low risk for the insurance company,” says Mansley.

Despite this, it’s a policy that’s very important to get right. Broadcasters generally require programs to have an E&O policy to be in place and American distributors will not purchase a film without one.

While working on psychological thriller Snowtown, Brian Holland found that putting the film’s E&O policy in place took weeks rather than days because of the nature of the subject matter. Productions based on real life stories require brokers to work closely with the producers to provide evidence that the people involved will be portrayed appropriately.

“You have to show that the treatment of people still alive is satisfactory and that the treatment of deceased people was satisfactory,” says Holland. “With Snowtown, we were dealing with people who were – how do I put this? They were allegedly murdered and not treated in a very nice way.”

Cover for intellectual property, defamation and copyright is particularly relevant in the age of viral marketing. According to Sun, film and television producers that market their films through social media face an increased level of exposure to risk. Aon has addressed this by launching Multi Media Insurance – a package which covers public liability, defamation and errors & omissions under one policy.

While preparing for online risks is manageable, readying productions for the possibility of greater dangers can prove a challenge. During the production of a recent series of ABC’s Hungry Beast, Mansley was contacted in the late afternoon about a scene that was to be shot the following morning.

“They rang me and said ‘Look, we’re shooting at 6:30 tomorrow morning, we’re going to air that night, and we need coverage in place for the guy we’re going to set on fire,’” he recalls.

Impossible? Mansley certainly thought so. But when he contacted the public liability insurer, they were happy to put a cover in place, for no additional premium. It was a stroke of luck – activities far less dangerous than setting a man on fire are often priced far more highly, or even rejected by insurers for being too risky.

In some cases, particular stunts or sequences can be deemed uninsurable because of the potential danger involved. When this occurs, the risk, and the responsibility needs to be dealt with contractually, or else removed completely by altering the scene.

“Every legal entity has a duty of care to the public and to its employees,” explains Mansley. “Insurance is transferring that risk, having another entity carrying your risk for a price.”

Before the show’s cancellation, Mooneys Insurance worked with Top Gear Australia, placing the film production insurance locally, but giving the motor and public liability insurance to underwriters from a London-based Lloyd’s syndicate which had previously worked on Top Gear UK. Mansley approached the London underwriters after unsuccessfully approaching insurers in Australia.

“I knew no one in Australia would take it, but I tried them anyway,” he says. “The Australian insurance market in general doesn’t understand film… When they don’t have a lot of knowledge in a particular area, they often err on the side of caution and simply decline to consider writing the risk.”

Mansley believes that the solution is educating insurers on the business. “Film isn’t all about blowing up buildings like Die Hard,” he says. “That’s actually the exception to the rule.”

This article first appeared in IF Magazine #144 Dec 2011 – Jan 2012.

The Reef.

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