Vaccinations are up, hospitalizations are down and, as evidenced by the throngs of international buyers at the Lowes Hotel this week for AFM, global travel is back. But for the industry, COVD, and the complications it brings to finance, insurance and making independent films remain here.
“The financial impact of COVID, logistics, COVID insurance, testing costs and so on, is long-lasting,” says Erika Lee, partner at Thunder Road Pictures (John Wick, Sicario), speaking at AFM this week. “It’s disappointing, because that’s a lot of money that’s not going to the screen.”
Well-established COVID protocols—everything from regular testing, mandatory masks for off-camera crews, and “bubble” systems that isolate different sections of production to prevent any possible outbreaks—have become standard practice and have greatly reduced the risk of a total shutdown. . But the associated costs, which amount to 10 percent of a film’s budget, can be crippling. And that’s before factoring in pricey COVID insurance policies.
“When it comes to insurance, it just keeps getting better,” notes Kirk D’Amico, president and CEO of Myriad Pictures. “A year ago, bond companies were required to have at least $1 million in COVID coverage. Now you can get $500,000 or more for the same project.
But in the US, the lack of regulation of the insurance market means that prices for COVID insurance can vary widely. Myriad began filming its Walter Hill-directed western dead to the dollar, Starring Christoph Waltz and Willem Dafoe, as new COVID variants are on the rise, this raises insurance premiums.
Even if you have COVID coverage, collecting those policies can be tricky. In September, a federal judge dismissed the lawsuit The Morning Show Producer Always Smiling Productions filed a $44 million claim in Covid-related damages against Chubb National Insurance Company.
The insurer agreed to pay only $1 million. Courts have dismissed similar lawsuits by Creative Artists Agency and United Talent Agency against their insurers, ruling that their policies did not provide the coverage the agencies claimed. Paramount’s successful settlement with a federal insurance company for COVID expenses Mission: Impossible – Dead Reckoning Part OneFinancial details were not disclosed, remaining exempt.
In several countries, including Canada or Australia, governments have offered to provide backstops to cover COVID-related expenses if an actor falls ill or production is halted. Efforts to pass similar legislation in the US have so far stalled.
Last year, Congresswoman Carolyn Maloney (D-NY) revived plans for the Federal Pandemic Insurance Act (PRIA), which would require insurers to provide COVID coverage (many still refuse) and the government to pick up 95 percent of insurers’ pandemic-related claims. . But PRIA remains a victim of Washington’s partisan gridlock.
“Regulation helps stabilize the market,” says D’Amico. “Not that it will save the industry, but it will make things less volatile.”
Without the legal clarity that federal legislation provides, indie producers continue to hedge their bets.
“Looking at packages in the market, you’re seeing important attachments that come with Covid exemptions,” says John Friedberg, president of manufacturing, sales and distribution outfit Black Bear International. “So you’re guaranteed a Star X.…unless it’s COVID.”
This story first appeared in the Nov. 4 daily issue of The Hollywood Reporter on American Film Market.