Hollywood’s “Disgrace Insurance” On The Rise To Cover Productions’ Sins And Losses

For TV producers who lose their shows because their stars are racist trolls zonked out on Ambien, they have insurance for that now. It’s called “disgrace insurance,” and it covers production losses due to a wide range of disgraceful and illegal behavior by members of the cast and crew.

The ins and outs of disgrace insurance was the subject of a panel discussion today at the PGA’s 10th annual Produced By Conference, which is being held on the Paramount lot.

Bob Jellen, managing director of HUB Entertainment Insurance and the guru of disgrace insurance policies, said he’s written more than 4,000 of them, but noted that they’ve only been invoked five or six times. They cover loses due to sexual harassment, assault, drug arrests and even murder by a cast and crew member.

He noted, however, that Rosanne Barr’s Twitter meltdown that caused ABC to cancel her hit series Roseanne probably wouldn’t be covered because her known propensity for making outrageous statements would have made it unlikely that any insurer would have offered the coverage.

Kevin Spacey’s firing on All the Money in the World because of sexual assault allegations probably also wasn’t covered because few feature films ever obtain disgrace insurance. Still, the producers of House of Cards might have a valid claim if they had the policy.

“Because of the #MeToo movement,” Jellen said, “we’re seeing a lot more claims coming in.”

Normally, he said, insurance costs producers 1%-2% of their budget, and disgrace insurance can double that.

The panel, titled “What Do You Mean That’s Not Covered?” examined numerous other types of disasters, large and small, that can befall productions and trigger insurance claims.

Mark Ballin, a partner at Claim Specialists International, recalled a show that was shooting in Mexico that had to high-tail it out of the country after receiving a threat that the cast and crew would be killed if they continued shooting there. “That was a claim that was covered,” he said.

Jellen noted such an incident is covered by “imminent peril coverage,” and that producers should make sure their policies contain the words “threat of” imminent peril.

“Many years ago,” Jellen said, “filming in New York was difficult because of the mob. You had to pay people off.” (He didn’t say whether or not that would be covered as a production loss, and several panelists agreed that that’s no longer the case in New York.)

Peter Oillataguerre, MGM’s president of physical production, noted that insurance covered many of the losses incurred on the James Bond film Spectre when actor Daniel Craig was injured on set. “It was pretty nutty, but we got through it and made the release date,” he said.

“We have seen many cases,” Ballin said, “where actors don’t make it to work where drugs were involved the night before — it causes chaos with production.” Sometimes that’s covered, he said, “but if the actor has a history of it, it’s not covered.”

“Every scenario is different,” said Jacqueline Volver, senior entertainment underwriter at Chubb Insurance.

Touched with Fire producer Jeremy Alter noted that insurance covered a wide range of difficulties faced on that 2015 film, ranging from the director of photography giving birth on the second to last day of shooting to Katie Holmes being mercilessly hounded by paparazzi.