Lights, camera, action

The media and communications industry is expanding rapidly as new technologies bring about new ways of reaching consumers. Broadly, media and communications incorporate: television and film; radio; newspaper; consumer and business-to-business magazines; new media; public relations; advertising; sales promotion; and marketing. With so many different types of organisations, in a rapidly changing sector it is no surprise that it has a wide range of insurance needs.

In the UK, the main insurers for professional indemnity (as opposed to property or general liability) are Hiscox, Media Professional (known as MediaPro or MPI), Markel, AIG and Chubb.

Many other insurers have smaller books for media. However, capacity is growing and there are more new entrants to the market than there were two or three years ago, according to Robin Walsh, UK media underwriting manager for Hiscox.

Brokers Marsh and Aon both have significant involvement in the media insurance market. Aside from the two giants, there are some smaller entities that have developed the expertise to provide a valuable service to the industry, according to Walsh.

He says: "Media Insurance Brokers, Sutton Winson, Allan Chapman & James Insurance Brokers (ACJ), Lucas Fettes & Partners and Thompson Heath & Bond all have expertise in one or more areas of the media industry, so the broking aspect has the involvement of both the multinationals and niche players."

Hiscox's book of insureds extends across the whole spectrum, from television and film production companies, to publishers, broadcasters, advertising agencies and other areas of the media industry. In terms of PI alone (excluding production insurance), Walsh estimates that the UK premium income on an annual basis for the media industry would be in the region of £25m.

The media underwriting team at Hiscox, which forms part of its aerospace, technology, media and telecommunications division, provides services ranging from PI to production insurance (i.e., the actual filming risk for television programmes, advertisements and the like). It also has a dedicated ATMT claims team, which deals only with claims falling into this category.

According to Walsh, it is important for employees to have experience of the different kinds of companies that operate in media and communications, particularly as the sector is changing so rapidly.

He says: "In terms of the development of insurance needs, the most significant change we have seen over the last couple of years is the advent of new media for content dissemination. Advertising is no longer restricted to television, radio and the press. There are now options to get the message across via SMS, e-mail, the internet, guerrilla marketing and so on. This has resulted in insureds facing sometimes unfamiliar exposures with regard to rights and content, and we have sought to keep pace with these developments.

"The advent of interactive broadcasting has meant that, to meet insureds' requirements under the contracts they are signing, we have had to work with various industry entities to gain a full understanding of the way in which this works and the potential pitfalls and problems they may face."

It is also important to keep abreast of legal developments in these industries.

The recent cause celebre from a legal perspective has been that of privacy, crystallised by the potential impact of the European Court of Human Rights ruling with regard to the publication in the German press of 'intrusive' pictures of Princess Caroline of Monaco.

According to Walsh, the impact of this ruling appears to be that any country falling under the ECHR's authority must ensure that the laws of the land provide adequate protection to individuals, including those who live their lives in the public eye.

In the UK, Walsh points to The Mirror vs. Naomi Campbell case, which further determined - some might say clouded - the parameters of what would constitute an infringement of privacy.

ACJ focuses on film, television and other media and has exclusive delegated authority to underwrite from Zurich. Terry Austin, managing director of ACJ, agrees that, to be successful in the media sector, it is vital to understand a client's business and needs to ensure you are able to provide the right service.

Austin says: "All staff have experience of the sector or are provided with training before having access to clients.

"We also operate a paperless office and workflow, which has been instrumental in our success. The production industry makes decisions on the hoof and needs answers straight away and cannot wait for searches files and documents."

He adds: "Technology has changed the way in which visual material is produced. For example, rather than edit a single video recording, it is done digitally on a computer. Material can be changed and enhanced and then it is stored on a computer. As a result companies increasingly need cover to include cyberliability and errors and omissions."

Broker media insurance provides services to all areas of the media industry, in particular insurance services to film and television producers. In addition to production and errors and omissions insurance it also provides ancillary covers to address the particular needs of any production. These specialist insurance protections can include marine, aviation, kidnap and ransom, detention, confiscation, personal accident and denial of access.

Gavin Taylor, company secretary of MIS, says: "We specialise in providing cover to protect the production process and the exposures associated with distribution, exploitation and transmission of the finished content. Productions vary greatly and can include all manner of things from stunts with dogs to car chases. As a result, a broad range of insurance covers is needed.

"We have access to a network of independent specialist brokers worldwide and to insurers in the US, which is important when placing clients' risks as they could be on location anywhere in the world. We also offer advice and help is available 24 hours a day, seven days a week whatever the location, which is important particularly where emergency medical assistance is required."

Specialised underwriting agency Media/Professional Insurance, part of the AUM Group, provides media liability, cyberspace liability and miscellaneous PI insurance covers for all sizes and classes of risks in the media, internet and service-orientated industries.

MPI offers a range of insurance packages, such as its Media Liability Plus Programme, which covers a range of media perils including: libel; slander; invasion or interference with rights of privacy or publicity;infringement of copyright, title or slogan; plagiarism; or misappropriation of ideas.

Depending on the insured's type of business, the policy can be endorsed to insure additionally against claims for bodily injury, property damage or financial loss resulting from errors or omissions in the content of insured matter.

Its CyberLiability Plus Programme is designed for website owners. Cover will respond to third-party liability claims alleging financial loss caused by a wrongful act arising from insured services while performing cyberspace activities.

Broker Sutton Winson offers a broad range of insurance services to all sizes of media and communications companies. Its Wired Insurance scheme has been developed in conjunction with a business development agency for new and evolving media businesses to tackle the problem of obtaining competitively priced insurance in the new media sector.

The scheme can include the following types of cover: property; computers; loss of income; employers' liability; public and products liability; PI; and internet and e-mail insurance. Additional covers are also available where necessary.

Noel Preston, manager of Sutton Winson's Burgess Hill office, says: "New-media businesses are emerging rapidly, particularly on the south coast. When companies start up they must have EL cover, but to get this on its own is practically impossible for small concerns. It is also often necessary to have PI if they provide a service and want to be able to secure finance or to be a member of an association. We have put together an affordable package including EL and PI, plus other protection products."

The ever-changing media and communications sector demands an in-depth knowledge and high levels of service from brokers and insurers.

Austin says: "There are a huge range of sub-niches that are involved in a huge range of activities and each need specific kinds of cover. Brokers cannot apply a broad-brush approach and they need to understand every client's business and keep on top of changes."