By Seth Tarboro, EHD Select Producer
$30,000,000,000. That is thirty billion – with a B and that’s how much money Hollywood made in 2024. That actually represents a slight decrease from previous years. Suffice to say, Americans consume this stuff like dollar dogs at a ballpark.
I grew up fascinated by projections on the silver screen. Space wizards with lightsabers were all I needed to know, but I had zero interest in having the charm of cinema spoiled for me by thinking about the corporations that made it all go. Unfortunately, the day comes for us all when we realize there is actual work being done behind our favorite movie moments, and that hit me hard. Like the first time you see an ice cream truck at a gas station and realize they aren’t actually fueled by the joy and laughter of children. Life comes at you fast.
As an insurance professional today, my struggle is not constantly thinking about the business behind everything.
INT. ICE CREAM SHOP – DAY
SETH and his wife NANCY approach the counter at a local ice cream shop. Surrounded by decals of smiling cows and actual smiling children they prepare to order.
SETH
Can you believe they still use these old plastic cups? I mean, the environment aside, I can’t imagine their carrier knows and they wouldn’t be happy about it.
NANCY
Not now… Please, not now.
They are greeted by a gentle smile and welcome from the girl behind the counter. She’s ready to take their order.
SETH
Quick question. Have you ever heard of PFAS? Because I’m sure your broker has and if I—
Nancy’s eyes roll back so hard she nearly falls out of her shoes… She elbows Seth in the side… He gets the point.
Show business is just that – a business. And like any properly functioning business, making sure you have the right coverages in place is what our friends at The Bear would call a “Non-Negotiable.” While we tend to look at the arts through rose colored glasses, Hollywood studios have one primary concern. HOW DO WE MAKE OUR MONEY BACK?!
The first step is protecting yourself from losing your investment and that is where insurance has saved Hollywood many times. While insurance cannot protect a movie underperforming based on quality, there are some catastrophes that can be avoided by having the proper coverage.
What’s that? You’d like three examples? That’s oddly specific, but like any good producer with a proposal on the horizon – I’ve come prepared.
INSURING AN EPIC: BEN-HUR
October of 1957, pre-production on Ben-Hur is underway. The film would go on to be more expensive than any movie before it, with a production budget of $15,200,000. While that doesn’t compare to the inflated amounts spent on blockbusters today, it was certainly a huge gamble at the time.
A gamble worth taking if you’ve got the right movie star attached, and Ben-Hur most certainly did. Charlton Heston was the biggest movie star in the world, but there was one problem. The film included a risky chariot race scene, in which Heston planned to perform most of the stunts himself. MGM, the production studio for Ben-Hur who happened to be on the verge of bankruptcy, took out a massive insurance policy not only to cover the potential for injury to Heston, but the rest of the cast as well.
At first, MGM was unwilling to allow Heston to participate in the chariot race scene, as a significant injury to him could lead to an extensive halt in production and the end of the studio as a whole. However, after seeing just how comprehensive the policy was and how even less significant delays or medical issues were diminished financially, MGM pushed their chips all in and allowed Heston to perform the stunts.
Ben-Hur ranks in the top fifteen all-time highest grossing films at the north American box office, when adjusted for inflation. Its most iconic scene may not exist in the way we have come to know it, if not for some epic underwriting!
THE INTERVIEW: CYBER INSURANCE TO THE RESCUE
While Ben-Hur is considered a classic, Seth Rogen and James Franco’s 2014 comedy The Interview, may not be held in as high regard. That does not, however, make it any less of a fit for this list.
The film poked fun at North Korea’s Supreme Leader Kim Jong-un and for their efforts, received quite a bit of backlash. Sony Pictures, the production studio, experienced a hack that led to a massive data breach. A hacker group known as the “Guardians of Peace” leaked confidential data such as employee emails, personal and family information and executive salaries. They also applied a type of malware intended to erase Sony’s computer infrastructure. Information found during the leak led to the resignation of high-level executives within Sony.
With their computer system held for ransom and the hacker group threatening terrorist attacks on any theatre showing the film, Sony was facing serious financial losses. The potential terrorist threat led major theatre chains to pull the movie from their release schedule, which meant Sony stood little to no chance of recouping the near $50 million dollar budget. The Interview was not the only film affected however, as the hackers also leaked unreleased films from Sony’s vault. Most reports estimate Sony incurred losses of well over $100 million.
Thankfully, between a combination of multiple insurers covering things such as business interruption, breach response and terrorism (yes, the oft-declined terrorism coverage), Sony was able to have most of their losses covered. In fact, estimates have the actual cost to the company at less than $35 million.
Not all superheroes – or sidekicks, wear capes. Some wear a quarter-zip and a haircut so tight it comes with a deductible.
MISSION: INSURABLE
It only feels right that for our grand finale; we use the greatest action movie series (no – this is not up for debate) as our example. Mission Impossible is an eight-film series, known for some of the greatest stunts ever put on film, High Risk, high reward.
In 2017, during the filming of the sixth installment in the series, Mission Impossible: Fallout, Tom Cruise was fifty-six years old and still as dangerous as ever. Insurance carriers knew the drill. Tom will do his own stunts; there is no point in trying to talk him out of it. Through five films, this was not a problem.
Fallout was an expensive film from the outset. Shooting across multiple countries like the USA, France, the UK, New Zealand, Norway, and the United Arab Emirates. Including a cast of Hollywood A-listers along with locations, vehicles and sets that cost thousands of dollars per day. All in, before any catastrophes, the movie had a budget of $180 million.
During a routine rooftop jumping sequence where Tom Cruise needed to leap from one roof to another, clearing a 16-foot gap, he snapped his ankle upon landing. He quickly scaled the rooftop and limped away to finish the take (this is the take used in the film). He could not continue filming the movie with a broken ankle, however. This meant production would immediately halt for eight weeks. When it comes to a film production, eight weeks of downtime is a massive loss. An $80 million loss to be exact. The delay and associated costs such as retaining cast and crew as well as extending leases on locations ballooned the original $180 million budget to $260 million.
Thanks to proper preparation and coverage provisions for cast injuries, including those sustained during stunt work, most of these extra costs were reimbursed through the insurance policy. Mission Impossible: Fallout went on to earn $791 million worldwide, and Tom Cruise owes his second biggest box office hit to some underwriters and brokers whose names we will never know. A tip of the cap and a raise of the mug to them.
CONCLUSION
As an insurance professional, it can be hard not to constantly think about how every business you engage with needs insurance and what coverage you would make sure to include if you were the one writing the policy. Movies happen to be my favorite past time, but this exercise could certainly be applied towards most other forms of entertainment.
My question for you is, if you could write a policy for your favorite past time – what would it be?
