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CMPA proposes ‘industry-wide solution’ to insurance conundrum

The proposal put forth by the producers' association would see the federal government serve as a backstop for COVID-19 insurance claims.
June 3, 2020

The Canadian Media Producers Association (CMPA) is in the process of developing a proposal that, if accepted, would see the federal government serve as a backstop for COVID-19 insurance claims.

Under the proposed solution – a detailed version of which will be submitted to the federal government in the coming days – producers would pay premiums for COVID-19 insurance coverage, which would go toward a funding pot designated for potential claims. The government would only be called upon to contribute financially if the funds generated through the sale of the COVID-19 policies was insufficient to cover the claims made, said the CMPA.

Since the production shutdown in mid-March, insurance companies have changed their coverage options so that claims related to COVID-19 (and communicable diseases more generally) are not covered. Across North America, the insurance industry as a whole is counting billions in losses and pending claims stemming from the onset of the COVID-19 pandemic.

“The CMPA is acutely aware that insurance companies are not offering COVID-19 coverage for the production sector at this time. Left unaddressed, this would mean the financial consequences associated with another industry-wide shutdown, or an on-set COVID-19 incident, would fall primarily to the producer. This would be potentially devastating to our sector and a significant barrier to the start up or resumption of production for many of our members,” read a statement from the CMPA. The association said it will also be reaching out to a “wide range of industry stakeholders to confirm broad support for this initiative.”

What remains unclear is how much producers would pay for the proposed premiums for COVID-19 coverage, and how much money would be in the pot. It is also likely that the government would need projections on how much a future production shutdown would cost before it committed to backstopping insurance claims related to COVID-19. (It should be noted that outside of exclusions for COVID-19 and/or communicable diseases, Canadian film and TV projects are still able to obtain insurance for production.)

While the implementation of on-set safety protocols and guidelines has dominated much of the discussion for the past two and a half months, the issue of how to resume production in the absence of insurance for COVID-19 has largely been viewed as the film and TV industry’s biggest obstacle, especially for higher-budgeted series, such as scripted dramas, that typically require larger casts and crews.

It is not simply a production issue, as bank loans, interim financing and financing contracts are typically contingent on the presence of insurance, making it all but impossible for independent Canadian projects TV projects to resume until a resolution has been found. It is supposed that unscripted projects and documentaries (which typically have smaller budgets and can be shot with smaller crews) will be able to navigate insurance issues more easily, however a clear route back to production has not been outlined for the unscripted or doc sectors in Canada either.

Other jurisdictions have proposed similar measures that would see the government acting as a backstop for COVID-19 insurance claims. Last week, the UK industry put forth a proposal that would see the government help cover the costs of shutdowns related to COVID-19. Other proposals have been put forth in Australia, France and elsewhere to help jumpstart the local production sectors, which are grappling with the same issues as Canada. In the state of New York, a proposal was floated last month that would also see the government backstopping insurance claims.

The unveiling of CMPA’s insurance proposal comes as Canadian provinces begin to release the guidelines for on-set processes in the age of COVID-19. Manitoba was the first province to release full details of its protocols, while Quebec also released its own guidelines yesterday. Other provinces, including Ontario, are expected to follow suit in the next week or two.

Previously the CMPA said it expects the production shutdown will mean at least a $2.5-billion shortfall in production spending ($773-million for Canadian content, $1.76 billion for the service economy) if film sets remain closed until June 31.

From Playback Daily. Image: Shutterstock

About The Author
Barry Walsh is editor and content director for realscreen, and has served as editor of the publication since 2009. With a career in entertainment media that spans two decades, prior to realscreen, he held the associate editor post for now defunct sister publication Boards, which focused on the advertising and commercial production industries. Before Boards, he served as editor of Canadian Music Network, a weekly music industry trade, and as music editor for HMV.com. As content director, he also oversees the development of content for the brand's market-leading events, the Realscreen Summit and Realscreen West, as well as new content initiatives.

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