Protecting Clients from Reality
Working with more than 450 production companies in the past year, Seth Cohen, area vice president with Arthur J. Gallagher, has handled some unique client requests. That includes covering cast members to participate in activities involving live ammunition and police raids, procuring event cancellation insurance for big productions like the VMAs, weather insurance for live outdoor shoots, and protecting stars of hit reality shows like the Jersey Shore. “A lot of the time, just by the nature of what we do, in the way we shoot these reality shows, it sort of bends the rules of how you should do things,” said Clay VanNortwick, line producer for 495 Productions. “Seth is always there to make sure we are covered appropriately and also can actually pull off whatever it is we’re trying to pull off.” “Seth has been very effective in thinking outside the box and coming up with solutions to difficult issues we’ve run into, as far as providing cast and crew coverage,” said another client, a risk manager for a television production company. Cohen’s success has been enhanced by his expertise in media and theater, as well as the mechanics of producing film and television content. Among other certifications, he has completed a professional program in production at the UCLA School of Theater, Film & Television. That specialized knowledge has made communication with cast doctors, entertainment lawyers, producers, financiers, production crew, and loss control experts more efficient and pointed, and helps Cohen find solutions to fit each production’s unique needs.
Making the Impossible Possible
Plenty of the things you see on screen seem like they’d be impossible to insure. It’s people like Lorrie McNaught who turn those impossibilities into reality. One TV episode about ghost hunting in an abandoned gold mine presented big dangers, especially when the mine owner decided he wanted to blast it. McNaught pulled together mine schematics and details of the mining process for a team of underwriters willing to accept the risk of reopening the abandoned site. “Those shows were most challenging because we really had to look outside of the normal protocol,” said Lyle Smith, vice president of production for 51 Minds Entertainment, an Endemol USA company. “She gave us comfort knowing we could move forward with shows of that type and magnitude.” Another challenge was a movie set in Florida at the height of hurricane season — starring rehabilitated dolphins, which meant extensive coverage for the location as well as the dolphins. McNaught pulled it off smoothly with contingency plans and heavy negotiation A third tricky shoot involved — of all things — torture. Needless to say, carriers weren’t racing to cover the risk. Convincing the market that the waterboarding procedure would be conducted safely was a challenge, and involved placing medical malpractice, general liability and accident medical coverage for supervising doctors. “She literally knows everything,” said Ethan Cohan, vice president, production and business affairs for production company One Potato Two Potato. “Any claim we’ve had, we’ve always had the right coverage.”
Having seen to the coverage needs of dolphins, ghost hunters, and gun-toting, bear-hunting moonshiners, Lorrie McNaught has plenty of experience for young brokers to draw upon.
But McNaught is not your average mentor. Last year, she worked to revitalize a small business unit at Aon that was formed to give junior professionals leadership experience. The unit had folded only months after it was formed, for various reasons. But McNaught championed the unit and fought to bring it back, taking on the task of managing that unit, and hiring and re-training its members. She also took ownership of the unit’s disenfranchised accounts, maintaining their business and earning back their confidence until the unit was ready to take on accounts again.
Less than a year later, the unit isn’t merely stabilized, it is achieving success. It has grown by more than 100 accounts through her efforts. “The team is encouraged and inspired,” said McNaught.
In the long run, this accomplishment not only benefits the insureds, but serves to bolster the future of the industry through the development of young professionals.
Within her company and on LinkedIn groups, McNaught offers herself as a mentor to younger professionals. In that role, she has tutored younger brokers on what it takes to succeed in the entertainment sector of the insurance business. McNaught’s goal is to empower young brokers, and to encourage them to embrace the opportunities before them.
With experience as an underwriter, risk manager, and now broker, Ross Pebley’s greatest skill may be the ability to see an issue from all perspectives. Pebley first began serving one of his clients as their risk manager, helping them seamlessly acquire another company, who also became his client when he joined Marsh as broker. Part of integrating the two companies involved incorporating their E&O programs, one of which had much lower levels of self-insured retention, which they wanted to maintain. Pebley negotiated with underwriters to keep separate SIR structures with shared limits for the two companies. “He’s assisted us through the renewal,” said Chris Miller, head of litigation for DreamWorks Animation SKG, Inc. “We’ve done acquisitions of companies and he’s been really the driving force and the lead for us. He’s helped us in our strategies in terms of which policies we should renew and which we should merge into the overall corporate umbrella.” Pebley has helped DreamWorks grow by making sure the company is covered for M&A activity and by constantly looking for better deals in the marketplace, Miller said. A client with another media company said Pebley’s availability and responsiveness have been crucial in getting issues resolved quickly. He goes the extra mile to understand all aspects of a question and anticipates related issues that may stem from it. His industry knowledge makes him a key player in brainstorming sessions on risk analysis. Pebley currently serves as program chair of educational programs for the Los Angeles chapter of RIMS, where he was president for 2012 and 2013.
Ross Pebley is passionate about his career in insurance. So passionate, in fact, that he has made it his mission to share his knowledge with young insurance professionals and to encourage young people — including his own daughters — to explore the rewarding career paths in entertainment insurance and beyond.
Pebley has a unique perspective to share. Having been the head of risk management at both DreamWorks, LLC and DreamWorks Animation SKG, Inc., he has an insider’s understanding of the challenges the industry faces.
Pebley later made the move to Marsh and began serving DreamWorks as a broker instead.
The move to the brokerage side meant that Pebley had to step down as president of the Los Angeles chapter of RIMS after serving for two years. But he happily agreed to continue serving as program chair, and continues to bring dynamic educational programs to the LA chapter for the benefit of its membership.
Pebley has spoken with members of the Gamma Iota Sigma society for risk and insurance management students and also offers himself as a mentor for young colleagues at Marsh, sharing his experiences and insights as well as his love of learning.
“I never stop learning,” said Pebley. “I always enjoy learning from people who work with various mediums in the entertainment industry. No one knows everything, but everyone knows something.”
Not Pulling Any Stunts
In the entertainment industry, schedules are tight and flexibility is crucial to keep things on track. Every second wasted is money lost. “If we’re late on a claim, we may have to delay shooting, which can cost us as much as half a million dollars, so communication is crucial between [Scott Schachter] and the production companies and business affairs people,” said Ron Pearlroth, vice president-group risk officer for WPP Group USA. “He’s very knowledgeable and very articulate.” Terry Rust, global production business manager for Red Fuse Communications, works with Schachter on a global basis. “Scott deals with me on production insurance on projects across the globe, and rules and regulations in different parts of the world influence what we need. No matter where I go, I know help will be there. Scott’s been tenacious in hooking us up and connecting us in different parts of the world,” he said. Rust’s company was filming a commercial in South Africa when a stuntman was severely injured before the shoot, which delayed filming by a week. Schachter advised Rust through the process, to the final reimbursement check. “That partnership is critical,” Rust said. Schachter also helped a client redirect their advertising strategy, switching from a large holding company to smaller boutique agencies. There was concern over risk management and costs associated with the smaller agencies, and Schachter was able to design a program that gave his client complete control over the advertising insurance process. This program led to much broader terms and conditions, and significant insurance cost savings.
Staying On the Ball
Marsh Senior Vice President Allan Smith helps his clients stay on top of their game. For the Arizona Cardinals Football Club, for example, Smith secured coverage from hesitant carriers for an inflatable bubble to protect the team’s stadium from inclement weather. Convincing underwriters meant compiling engineering data on the bubble’s construction and proving it could withstand winds that had toppled similar projects. Smith was able to alleviate their concerns and get competitive terms for coverage. “He really gained a great understanding of our companies,” said Greg Lee, CFO of the Arizona Cardinals. “We are primarily a football club, but we have a lot of operating business segments from charter aircraft, hospitality, concession services and restaurants. He jumped right in and gained a good understanding of how those companies relate and what other risks are associated with them. He made sure we had products in place to address those various risks, whether it’s terrorism coverage related to our stadium, or the necessary coverage for compliance with our financing. And he advised how we could reduce our overall risk.” A review of another client’s general liability policy revealed a critical exclusion that Smith was able to knock down. The client, Everlast Worldwide, used sand as filler for its heavy bags and other pieces of equipment. Their policy, however, excluded coverage for silica. Though he met with resistance, Smith negotiated for modification of the exclusion, which meant regaining coverage for a significant portion of the company’s sporting equipment.
Saving the Show, Scene by Scene
The show must go on, and Momentous Insurance Brokerage’s Winnie Wong makes sure it does. Serving movie and television production companies, Wong insures production facilities, crew members and actors, anywhere in the world. Nearing the end of a shoot in South Africa, one production company decided they wanted some additional scenes in a refugee camp in Kakuma, Kenya, an area known for kidnappings and shootings. Wong had to secure supplemental policies to protect the cast and crew, including accidental death and dismemberment, and kidnap and ransom coverage. Even trickier, a lead actress not involved in the scenes wanted to visit the camp anyway, but wouldn’t be covered under her essential elements policy. Wong worked around it, placing confidential key man life coverage with the production company as beneficiary. “I don’t even know how she got insurance but she did,” said Sarah Sprague, production supervisor in the United States for “The Good Lie” LLC. “She gave us peace of mind.” “When I would bring up issues that I thought were important, she already knows about them and we’d be able to discuss them intelligently,” said Greg Krutilek, head of business affairs for Silverscreen Alta Pictures. “Anytime you deal with someone who really knows your business and can discuss it intelligently with you, that’s important. I feel that Winnie’s that person.” Wong has also shared her industry knowledge in the form of a textbook. Published in 2013, her Hollywood Studio Production Techniques provides filmmakers with information about deal memos, budgets, schedules, legal issues, insurance, and safety on the set.
Winnie Wong’s passion for the industry that she serves as an insurance broker clearly goes beyond the transactional. She strives to be a resource for the filmmaking community and has taught classes on entertainment insurance for UCLA Extension, the International Documentary Association and Film Independent. Wong has also written articles and authored blog posts on some of the finer points of the film production business.
Experience taught Wong that filmmakers tend to pour all of their energy into the creative process and often lose sight of other crucial aspects of the business. She recognized that this lack of knowledge could imperil young filmmakers financially and even prevent promising films from ever being released. To help fill that gap, Wong authored a 14-chapter textbook, Hollywood Studio Production Techniques, to give young filmmakers the tools they need to navigate the business end of film. In addition to information about insurance and risk management on the set, it also covers the roles of the production crew, deal memos, contracts, tax incentives, locations, equipment, scheduling, budgets and more.
She does this because she wants to see young artists achieve their full potential creatively and not be blindsided by unforeseen liabilities. She is equally committed to helping young brokers thrive in their careers.
As a member of several film associations and a Women in Film board member, Wong encourages young people to pursue jobs in the entertainment insurance field.