Amid millions lost in box office receipts and production costs due to the coronavirus pandemic, Hollywood studios are now aiming to collect on their insurance policies. Allianz, in one case, notes it sees a rise in claims while studios have needed to put a stop to large productions, CNBC reported.
Allianz, as well as other large film insurers such as Chubb, Aon and Lloyd’s of London, are currently swamped with claims.
“They’ve never had so many claims, which is I think what’s unique about this situation,” Sarah Cronin, a partner of the Venable law firm, said per the report. “This is one thing affecting people all over the world, and insurance companies are getting tens and tens of thousands of claims at the same time.”
Allianz estimates that studios put $400 million toward premiums in 2019 to cover “unforeseeable events.” Premiums, for their part, usually range from 0.6 percent to 1 percent of the budget of a movie. Studios dedicate up to $2 million in insurance for a $200 million production.
Sean Kevelighan, the chief executive of the Insurance Information Institute, said in a statement per the report, “We understand that Covid-19 has not spared Hollywood films and TV show productions. The insurance industry provides policies that protect studios from unforeseen circumstances.”
Kevelighan continued, “Most of these policies are triggered when there are fires or accidents which either injure performers or damage property on set. Nonetheless, the coverages incorporated into the film and TV industry’s insurance policies can vary greatly. Insurers will review every claim submitted to them to determine on a case by case basis when coverage is available.”
As previously reported, the entertainment industry has been greatly impacted by the coronavirus crisis as TV shows, and movies have fallen out of production, theatrical releases have been postponed, and cinemas across the country have shut down. And, while some releases have been delayed, many others have been sent to streaming.