Moviemakers seeking to film in the far corners of the globe can count on a healthy insurance market to cover their risks, which are lessening in some locations, brokerage executives said.
Chris Palmer, director of risk control, and Brian Kingman, senior vice president with Aon-Albert G. Ruben, a subsidiary of insurance broker Aon Inc., made those observations during a conference call discussing the 2006 map of Risks in Global Filmmaking.
Mr. Palmer, the map's co-author, said this is the third year of production of the map that aims to help clients identify and measure the various risks in possible locations including terrorism, health, political and kidnapping.
One of the biggest threats for filmmakers is the issue of terrorism, he noted, both on the local and global stage. The flare-up in the Middle East over the cartoons depicting Mohammed have also touched off added concerns for filmmakers overseas where threats of terrorism may not have been an issue before, he said.
Kidnapping remains a concern in a number of places, Mr. Palmer said. China revealed recently that it has experienced over 600 kidnappings during the past year. Aon-Ruben is still collecting additional information on the subject, but Mr. Palmer said that the problem is limited to local businessmen living along the nation's coastline.
"It is something we are concerned about," said Mr. Palmer. "It is something we are keeping clients advised on."
Mr. Palmer noted that an outbreak of the Avian flu among humans could prove to be highly disruptive to television and film production. Such an event could conceivably cause a total shutdown of travel, suspending or ending productions in some areas.
Some places that have seen improvements in their risk profile are Morocco, Nicaragua and Slovak Republic, where economic growth or decrease in terrorism, or both, have made the locations more appealing for filmmakers. This is especially good news for Morocco, where the threat of terrorism has decreased, and which is a popular destination for filmmakers, said Mr. Palmer.
When it comes to obtaining insurance, Mr. Kingman said capacity is not a problem, but it is normally two-to-three years behind the rest of the industry. Some insurers, he said, say their reinsurance costs are on the rise by 5 percent, but he questioned whether that means an increase for policyholders.
"Insurers will always try to pass along their costs, but I think the market is fairly competitive, and I think they are going to have a tough time [passing the costs along]," observed Mr. Kingman. "They are making money in our industry right now, so I don't think they really need to transfer those costs. But, obviously, insurers will try to pass along the cost of any increase back to the insured."
Terrorism is at least one cover that is not dependent upon renewals of the Terrorism Risk Insurance Act, noted Mr. Kingman. He said terrorism policies are primarily custom made in London, though some insurers offer coverage that includes relocation, damage or loss of equipment, props or other related elements of filmmaking.
Mr. Palmer noted that the policies are not limited to actual acts of terrorism, but have a mechanism in the policy for evacuation for threat or possibility of terrorism.
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