There are three major areas of insurance cover for films — production, errors and omissions and distribution.

Production insurance covers all the risks related to the production or shooting of the film.This includes fire, injury or death of a lead cast, abandonment of the project, loss of negatives etc. If a hero performs all the stunts by himself, the risk of getting injured is more. In the shooting of My Name is Khan, shooting in LA could not be done on account of the snowfall. Such an eventuality is covered by insurance.The production insurance cost is linked to the cost of production, say 0.5 to 2 per cent of the Cost of Production.The cost is more for the new entrants, say 2 to 3 per cent.

Errors and Omissions (E&O) insurance covers the claims arising from defamation, libel,title infringement and copyright infringement. There are cases by writers, musicians, lyricists of copyright violations on the eve of the release. Sometimes some people find a potion of the film objectionable. E&O will cover anything related to the content of the film.

Distribution cover starts from a week before the release of the film to usually 60 days after its release.It covers any eventuality that does not allow natural business release of a film to take place.As swine flu scare caused the closure of malls and multiplexes, UTV’s Kaminey was adversely affected.This is an eventuality that is covered by distribution insurance.

Formerly there were vanilla policies covering anything. These days the policies are customized.The policy is designrd by the insurance broker.