Insuring the Content of the Film
While general liability insurance protects a film production against on-set accidents like injuries or equipment damage, Errors & Omissions (E&O) insurance covers a completely different set of risks: lawsuits related to the film’s actual content. Once a film is released to the public, producers and distributors are exposed to potential legal claims from individuals or entities who feel they have been wronged by what is depicted on screen. E&O insurance is designed to cover the legal fees and potential settlements from these kinds of lawsuits.
What E&O Insurance Covers
An E&O policy is essential for protecting against a wide range of content-related legal claims, including:
- Defamation: Lawsuits alleging that the film libeled (in a visual medium) or slandered a person or organization, damaging their reputation.
- Invasion of Privacy: Claims that the film publicly disclosed private information about a person without their consent.
- Copyright Infringement: The most common type of claim, alleging that the film used a piece of music, a story idea, a clip, or any other copyrighted material without proper licensing.
- Trademark Infringement: Unauthorized use of protected logos, brand names, or other trademarked material.
- Plagiarism: Claims that the screenplay was stolen from another writer’s work.
The Clearance Process
Insurance companies will not issue an E&O policy blindly. Before coverage is granted, a producer must provide proof that they have performed rigorous due diligence to clear the film of potential legal risks. This involves hiring an entertainment lawyer to conduct a full ‘clearance review’ and produce a clearance report. This process includes:
- Chain of Title Review: Verifying that the production legally owns the rights to the screenplay and any underlying material (like a book or article).
- Script and Film Review: The lawyer reviews the script and watches the final cut to identify potential risks, such as character names that are too similar to real people, potentially defamatory scenes, or incidental use of copyrighted art or logos in the background of a shot.
- License Verification: Confirming that all music, archival footage, and still photos used in the film have been properly licensed from the copyright holders.
No distributor, broadcaster, or streaming service in the world will acquire and release a film without proof of a valid E&O policy. It is a mandatory and indispensable final step in preparing a film for public consumption, protecting the entire distribution chain from legal liability.