Ad Agency Insurance Seminar


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Quick summary of how to insure your ad agency

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Ad Agency Insurance Seminar

  1. 1. Risk Management & Insurance Jack M. Buttine John Buttine Inc. New York, NY 10017 1 800 964 4454 [email_address]
  2. 2. Risk Management & Insurance <ul><li>We will discuss … </li></ul><ul><li>Property & Liability insurance policies </li></ul><ul><li>Use of Certificates of Insurance </li></ul><ul><li>Workers Compensation Issues involving non-employees </li></ul><ul><li>Auto Insurance and Agency Auto use policy </li></ul><ul><li>Loss control tips & techniques </li></ul><ul><li>Weather Insurance </li></ul><ul><li>Production and Special Event Insurance </li></ul>
  3. 3. Risk Management & Insurance <ul><li>Types of property & Liability policies </li></ul><ul><ul><li>Personal property, stock photos, property of others, computers & hi tech equip, office improvements, etc. </li></ul></ul><ul><ul><li>Commercial General Liability (CGL) policies – covers slip & falls arising from office activities, special events & production activities </li></ul></ul>
  4. 4. <ul><li>Types of policies (continued) </li></ul><ul><ul><li>Auto Liability </li></ul></ul><ul><ul><li>(and Physical damage) </li></ul></ul><ul><ul><ul><li>Owned, leased, hired & non-owned </li></ul></ul></ul><ul><ul><li>Umbrella Liability </li></ul></ul>Risk Management & Insurance
  5. 5. Risk Management & Insurance <ul><li>Certificates of Insurance – “ Certs” </li></ul><ul><li>Protects you and your client from claims caused by your vendors or contractors </li></ul><ul><li>Should list agency and client as Additional Insureds </li></ul><ul><li>Usually no charge to vendor to add agency & client to its liability policy </li></ul>
  6. 6. Risk Management & Insurance <ul><li>“ Certs” (continued) </li></ul><ul><li>Should have one Cert per project for each client and one for you </li></ul><ul><li>Keep Certs on file </li></ul><ul><li>Use form letter and sample Cert to standardize Certs from your vendors or contractors </li></ul><ul><li>Always check the expiration dates relative to the dates of the work </li></ul>
  7. 7. Risk Management & Insurance <ul><li>“ Certs” (continued) </li></ul><ul><li>The process highlights the risk-reward ratio of some activities </li></ul>
  8. 8. Risk Management & Insurance <ul><li>The main reasons to obtain Certs </li></ul><ul><ul><li>Save your insurance for your mistakes – plus , you may not have coverage! </li></ul></ul><ul><ul><li>Reduce costs. Certain types of insurance are rated by attendance, # of days, rental cost or fees paid to others. Certs may provide credits at policy audit time </li></ul></ul><ul><ul><li>Protect your loss record. Your insurance is a function of your claim history </li></ul></ul>
  9. 9. Risk Management & Insurance <ul><li>Workers Compensation & non-employees </li></ul><ul><li>Every worker must have benefit of a Comp policy </li></ul><ul><li>Applies to independent contractors, freelancers and talent </li></ul><ul><li>Request Cert from all firms and non-employees you pay money to. </li></ul><ul><li>Your Workers Comp and Production Liability policies are subject to annual audit of agency payroll and amounts paid to contractors </li></ul>
  10. 10. Risk Management & Insurance <ul><li>Auto Insurance Policy – what it does … </li></ul><ul><li>Covers owned, leased, non-owned or rented cars </li></ul><ul><li>Provides </li></ul><ul><ul><li>liability protection against bodily injury or property damage claims </li></ul></ul><ul><ul><li>Physical damage coverage to the agency or rented vehicle </li></ul></ul><ul><li>Two basics </li></ul><ul><ul><li>Insurance ‘follows the car’ – anyone can drive </li></ul></ul><ul><ul><li>The agency’s assets are in the trunk </li></ul></ul>
  11. 11. Risk Management & Insurance <ul><li>Policies on use of agency autos </li></ul><ul><li>Business use </li></ul><ul><li>Comply with laws on cell phone usage – avoid using cell phone while driving </li></ul><ul><li>Agency will check employee’s driving record to determine if employee may use vehicle on agency business </li></ul><ul><li>Avoid picking up hitchhikers </li></ul>
  12. 12. Risk Management & Insurance <ul><li>Policies on use of agency autos – (continued) </li></ul><ul><li>Do not carry more people than you have seat belts </li></ul><ul><li>No firearms or hazardous materials </li></ul><ul><li>Keep your speed safe based on road and weather conditions </li></ul><ul><li>Do not drive if incapacitated – tired, alcohol use, drugs of any type, etc. </li></ul>
  13. 13. Risk Management & Insurance <ul><li>Policies on use of agency autos – (continued) </li></ul><ul><li>Must use seat belts </li></ul><ul><li>Do not switch off air bags </li></ul><ul><li>Do not customize or add non-OEM equipment to vehicle </li></ul>
  14. 14. Risk Management & Insurance <ul><li>Loss Control – Property losses </li></ul><ul><li>Laptops are most common loss </li></ul><ul><li>Do regular inventories of laptops </li></ul><ul><li>Have a Valuable Property Control policy </li></ul><ul><li>Check trash – good things end up in dumpster & require that cartons be flattened </li></ul>
  15. 15. Risk Management & Insurance <ul><li>Loss Control – Property losses </li></ul><ul><li>Know who has keys to agency </li></ul><ul><li>Set a good example (yes! It is stealing!) </li></ul><ul><li>Check references </li></ul>
  16. 16. Risk Management & Insurance <ul><li>Commercial Production Weather (Wx) Insurance </li></ul><ul><li>Policy is a trade-off: Sure loss of insurance premium v. uncertain loss of one day’s production cost. </li></ul><ul><li>Insurance protects your clients bottom line by stabilizing production costs. </li></ul>
  17. 17. Risk Management & Insurance <ul><li>If you cannot shoot your film or commercial during the allocated time due to poor weather conditions, it costs money to re-shoot. </li></ul><ul><li>Policy pays based on amount of light, number of rain-free hours or amount of rain that falls. </li></ul><ul><li>Can be placed as close as 10, or sometimes 7, days before event. </li></ul><ul><li>Very flexible design; you pick the limit </li></ul><ul><li>A “stated value” policy’ i.e. insure all or part of the shoot – your choice. </li></ul>
  18. 18. Risk Management & Insurance <ul><li>Rate is function of frequency of adverse weather at location of shoot. </li></ul><ul><li>Premium is based on limit or budget. </li></ul><ul><li>Time to get quote – 12 to 18 hours </li></ul><ul><li>Independent Wx observer or a wx satellite reporting system is used to determine degree of adverse weather – rain, fog, wind, too little sun, etc. </li></ul>
  19. 19. Risk Management & Insurance <ul><li>Production Insurance </li></ul><ul><ul><li>A “package” consisting of ... </li></ul></ul><ul><ul><ul><li>Liability Insurance </li></ul></ul></ul><ul><ul><ul><ul><li>Commercial General Liability & Umbrella </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Property Damage Liability for rented locations </li></ul></ul></ul></ul><ul><ul><ul><li>Property Insurance </li></ul></ul></ul><ul><ul><ul><ul><li>Faulty Negative/Extra Expense </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Rented Equipment, props & sets </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Rented Automobiles </li></ul></ul></ul></ul><ul><ul><ul><li>Automobile Physical Damage & Liability </li></ul></ul></ul>
  20. 20. Risk Management & Insurance <ul><li>Production Insurance: two “kinds” </li></ul><ul><li>Agency as “Named Insured” – when you buy </li></ul><ul><li>Agency as “Additional Insured” – when production company buys </li></ul><ul><li>When production company buys insurance you benefit from their policy but you have to require details on a Certificate of Insurance </li></ul>
  21. 21. Risk Management & Insurance <ul><li>Certificates of Insurance </li></ul><ul><li>Evidence of another’s insurance </li></ul><ul><li>Protects Agency and its Clients </li></ul><ul><li>One “Cert” for Agency and one for its client </li></ul><ul><li>Require total of $5mm of liability </li></ul><ul><li>Must include current policy dates and name of shoot </li></ul>
  22. 22. Risk Management & Insurance <ul><li>Your production policy: “Agency and Partners as Named Insured” ... </li></ul><ul><li>Covers Agency and it clients for claims arising from production activities. </li></ul><ul><li>Applies when Agency employees are directing </li></ul><ul><li>Does not apply to activities in Agency’s office, i.e. concept, editing,… </li></ul>
  23. 23. Risk Management & Insurance <ul><li>All insurance is a “pass along” cost </li></ul><ul><li>Include insurance in your budget. </li></ul><ul><li>Rates apply to Gross Production Cost (GPC) - $ per $100 of GPC. </li></ul><ul><li>One rate is available for all production package policies – property, liability, and umbrella. </li></ul><ul><li>Production Policy is audited at based on GPC. </li></ul>
  24. 24. Risk Management & Insurance <ul><li>Special Event Insurance </li></ul><ul><li>Applies to promotion marketing and other outside the office activities. </li></ul><ul><li>A special form of general liability insurance. </li></ul><ul><li>Can cover a range of special event activities – tradeshow show booth, shrink wrapping vehicles, demonstrations or giveaways, etc. </li></ul>
  25. 25. Risk Management & Insurance <ul><li>Special Events should be “reasonable” - ??, call </li></ul><ul><li>No need to pre-approve </li></ul><ul><li>Policy has exclusions </li></ul><ul><ul><li>Pyrotechnics, Aerials, Bodily Injury to participants, Racing, etc. </li></ul></ul><ul><li>Agency & its Client should be named as Additional Insureds on contractors’ insurance policy </li></ul>
  26. 26. Risk Management & Insurance <ul><li>What are your questions? </li></ul>