By Larry LeBlanc
According to Pam Weiser, proper insurance is what insures that the entertainment industry’s wheel goes around and around.
The affable Weiser, executive vice-president at Momentous Insurance Brokerage, headquartered in Van Nuys, California, puts together insurance packages for the entertainment industry.
She has worked in the entertainment insurance field since 1980. Prior to being a broker, she was an underwriter. She is well-versed in music, film coverage, and personal insurance.
Momentous Insurance Brokerage is a full service entertainment-based firm specializing in designing insurance programs for high net worth individuals, film and TV productions, music and touring companies, and artists.
Momentous offers nonappearance policies for concerts and tours, and business package policies for commercial enterprises that entertainers or entertainment executives own.
It also offers personal lines policies, such as coverage for homeowners including life, disability, and vehicle insurance etc.
The company recently launched its Nightlife Division, a dedicated insurance unit founded by Graham T. Orleans, for DJs, performers, promoters, and nightclub owners.
Obviously, liability exposure for entertainers is highest during their tours.
Today, there are multiple players involved with liabilities arising from touring and each tries to share limits on a policy.
Promoters generally accept the liability for bodily injury and property damage, and name artists as additional insureds.
There are also cases where the venue requests that the promoter add them to the same policy. There are some venues who ask both the promoter and the artist to name them as additional insureds.
If the limits are not enough, however, an entertainer could be named in the suit and become responsible for the excess limits, particularly if their negligence can be proven.
This may prove to be the case with the tragic, weather-related stage collapses that rocked the touring industry this summer.
Seven people died, and 40 were injured when the stage collapsed at a Sugarland concert in Indianapolis; five died in Belgium when a storm toppled the stage at the Pukkelpop Festival; and a heavy storm brought down the lighting rig at a Flaming Lips concert in Oklahoma.
As well, several people were injured when the stage went down at Bluesfest in Ottawa.
Meanwhile, there's been an adjournment in the case against three Canadian companies charged in the 2009 fatal stage collapse at the Big Valley Jamboree music festival near Camrose, Alberta.
More than a dozen people were injured, and a woman was killed when a powerful windstorm swept through the festival site.
A total of 33 charges were laid against Panhandle Productions, Global Production Company and a numbered Alberta company.
In Indiana, 45 tort claims have been filed alerting the state of possible lawsuits in the wake of the Indiana State Fair stage collapse.
A month following the August collapse, Sugarland—who never actually got to perform--was being blamed for the incident, together with their "members, agents and employees.” The band is one of 15 defendants in a new filing.
While a lawsuit has not yet been submitted, this legal notice sets the stage for further action.
Teams of investigators are currently researching the circumstances surrounding the Indiana State Fair disaster, including a review of permits, inspections and safety plans. This investigation is expected to take as long as eight months.
What are your duties at Momentous?
What I do is I co-ordinate all the accounts that we handle within our company. My specialty is entertainment. So I put together comprehensive insurance packages for the entertainment industry which includes touring entertainers, actors and actresses and well as motion picture/television insurance.
Is entertainment a big part of Momentous coverage?
Tour coverage is not a big money maker because there are a lot of insurance companies out there, and they compete a lot. Premiums aren’t as expensive as you might think they might be. What we do—and what I think makes Momentous so special—is that we can handle every single (insurance) aspect of an artist’s life. Whether it be personal, medical or commercial, we can give them a package. We can insure their personal cars, their vans, trucks and buses. We can insure their buildings.
When an artist gets going in this business, they get a bit of money, and they open other businesses. We have several artists that have restaurants or clothing lines. So we are able to envelope that as well. You come to us, and you say that you want to raise snakes in a tree, and that you need insurance for it. What we are good at is putting that insurance in place for you.
Do you tour with the bands you cover?
I never go on the road. I have been to the concerts, and I have stayed at the hotels, but I have never been on a (band) bus. I have never done that. I have been offered.
Any natural disaster must keep you busy.
I can never enjoy a natural disaster. I know that sounds funny. I remember when Hurricane Katrina was going into New Orleans. I remember watching it, and thinking, “What a beautiful hurricane. It’s perfectly formed.” And it was all over the news, and it was TV during the Labor Day weekend. I was at home, and I was doing things around the house, and I kept watching it.
Saturday night, I went, “Wait, I have a studio (in New Orleans). Do I have flood coverage there?” I swear to God that I didn’t sleep all night. I got on the computer the next day. I couldn’t find the flood coverage. I was devastated. I went back and I went into the file. It took me an hour to finally find out where the flood coverage was. It was with another carrier. They had written the primary flood (insurance); I had excess flood on (the policy).
So I could sleep.
But I was also writing non-appearance coverage on two artists that could not perform in New Orleans. So I worried about that too.
[Hurricane Katrina in 2005 was the costliest natural disaster, as well as one of the five deadliest hurricanes, in American history. At least 1,836 people died in the hurricane, and in the subsequent floods. Total property damage has been estimated at $81 billion.]As you said, you also handle personal insurance for artists.
For their homes, their vehicles, their children’s lives, their health, their disabilities. Whenever there’s a fire in the (Hollywood) hills, we’re on the phone all night long. We are sending each other lists of zip codes to find out where the fires are. We are running lists, and we are notifying our clients. It’s not fun.
Many insurance companies dealing in entertainment are boutique operations.
Touring insurance is like any other kind of business insurance, but there are different nuances of coverage that people have to know. The only way you can be insured correctly is by someone who knows what is needed, and can put all of the parts together. There are a lot of people who get into insurance, and want to do entertainment, but they fail because they don’t know the business. You have to know the music business. You have know the film business. You have to know what you are insuring, and the working parts behind it. If you don’t, then it’s never going to work.
You must spend weekends waiting for the phone to ring.
You know what? You learn that insurance is like legal gambling. Sometimes you expect a claim, and sometimes it never happens. The ones that you don’t expect a claim on, it happens. Like Sugarland, for instance. Sugarland is country. They go around the United States. They have toured for a couple of years. They are beloved by their fans. They win Grammys, and they look nice. They are sharp, and they are business people. They run their business clean, and then something like this happens. It hasn’t been determined, but the fact of the matter is they probably are not responsible. But yet, they get called into something like this.
Sugarland has been named in a legal notice charging them with "gross negligence and/or recklessness" over the disaster.
Yes. (As a victim or family member of a victim) I would name them too. I don’t know who is at fault, but I am just going to name them all at the same time, and let them (investigators) sort it out; because I am going to get money. I am going to get money.
So you weren’t surprised by Sugarland being named in a legal notice in this case?
No. Not at all. I will be interested to see if some of the equipment companies get named in the suit too. Sugarland had the bad misfortune of going on next. They could have been off the stage, and out the door. But they might have hung a speaker that might have weakened it (the stage). If I am the stage insurance company or the stage lawyers, I’m going to go in there and say, “Sugarland was here, and they bumped one of the bars when they were taking their equipment on or off, and weakened the stage.”
You aren’t involved in the Indiana disaster in anyway?
No. When that stage collapsed, I was in bed ready to fall asleep. I was half-listening to the TV. It said, “Stage Collapse In Indiana; Several Killed,” and I was like, “Holy crap! What did the stage look like?” I opened my eyes to watch it (the coverage), and I was like “Oh, my God.” I went through a list in my head: “Who’s the group? Who’s the promoter? Who was the band before?”
I went through every single scenario in my head of who was there.
Then I was up all night.
Now what happens when something happens like this is that, because our office insures every facet of the touring industry, we’re on the phone all night. On the Monday, we were on the phone with the carriers. Who had it (the policy)? How much did you have? What is it? Who’s the promoter? Who’s this and who’s that? By the end of the of the day on Monday, we had a pretty good perspective of what this claim was going to be about, and how much money it was going to be worth to everybody. Then, of course, on top of that you are feeling so horrible for the people who have lost a loved one or were injured.
The Indiana State Fair was just one of several weather-related stage collapses this summer.
This (Indiana) stage thing is going to be the “Great White Claim” this year. It’s going to be, “It’s the artist.” “No, it was the acoustical ceiling tile person.” “The guy who built the building because he didn’t build enough exits.” “No, it’s the table guy because the tables were too heavy to move out of the way.” It is just going to be everybody, and anybody involved.
At this point 45 tort claims have been filed alerting the state of Indiana of possible lawsuits. This won’t be resolved…
It won’t be resolved for years. I would say five or 10 years. The fact of the matter is that by the end of the lawsuits everybody will have been named. People are going to sue people that were sitting next to them because they (will say that they) couldn’t move out of the way fast enough or they barred them from leaving. There are going to be lawsuits on lawsuits. Someone is going to say, "I was 20 rows back and I didn’t even feel the gust of the wind when it hit the stage but I am so traumatized by what happened.”
Insurance companies have long been aware of the inherent dangers in outdoor events. But with the number of concert accidents seemingly on the rise, will they now re-evaluate their policies?
Eventually the insurance companies are going to be looking at a lot more of the stage plans and, maybe, they will require the stage makers to carry a larger load of the (insurance) risk. At this time, they (stage makers) will say, “We are building you this stage. We have insurance of $2 million. You are responsible to name us as additional insureds.”
I’m thinking that what is going to happen from now on is that, maybe, the insurance company will take a more restrictive look at the contracts to see who is going to be held at fault. They might even ask questions like, “What else is going to be part of this stage? Who is going to be responsible for doing this stage?” There are a lot of riggers that go on tours, and the riggers put up these stages. There might be more education in how to put these stages up.
Something like these stage collapses in the last year, I don’t know if it’s the sign of the (poor) economy or not. Maybe organizers have five men putting up a stage instead of 20. Maybe, they thought that someone would cost them too much to employ so they took someone right out of college who doesn’t have any experience at all--just college experience. I don’t know.
Under Indiana law, there is only $5 million available to share among the victims.
That’s going to go over really big. That’s another thing (to be examined). If I am an artist, and I know that this venue that I am playing is only going to be responsible for $5 million, should I increase my liability in case I have to be contingent over theirs? Yeah, you do.
If Sugarland was guaranteed their fee or a part of their fee, and that resulted in the organizers not stopping the show, that may factor in the negligence suit.
I think that when it comes down to it it’s going to be, “Was it the act of the weather?” Yeah, but there were also thinking human beings there that should have said, “It‘s far too tumultuous for us to have them go out onstage.” Even if they said, “You guys need to leave (the backstage area). We will try to do the concert when it (the storm) passes.”
C’mon they have baseball and football stadiums that stop play as soon as a storm starts coming. You don’t put a bunch of people in an exposed area with a huge storm coming. And was the stage built incorrectly? Probably. My house is probably built incorrectly. I can’t say until an earthquake takes it down. It’s a natural disaster but if my house falls, and the house next door, built by someone else, doesn’t (collapse) then whose fault is it?
Certainly, the weather has been erratic in recent years as well.
Yes, weather is a factor. But a few miles away, there was another event going on, and it was the Symphony Orchestra and organizers there said, “We don’t want everybody outside. You guys need to disperse.”
Now if that wasn’t Sugarland going onstage, and it was some little band from the Ozarks, they probably would have suspended that (Indiana State Fair) concert. But, because of who it was--that it was Sugarland; and the loss of money (for the fee), and the loss of (gate) revenue, and that they could never re-schedule that concert; I’m not sure, but I think that was a little bit of the thought process with the promoters of that concert.
[At issue is whether Indiana State Fair organizers responded quickly enough to forecasts of an approaching storm, especially since a concert nearby was canceled because of the weather.Just 15 miles north in the suburb of Fishers, about 6,700 people attending a performance by the Indianapolis Symphony Orchestra were evacuated from the Conner Prairie Amphitheater.
"We saw a storm that contained lightning dip south a little bit,” explains Tom Ramsey, the orchestra's VP and GM. “Once we saw that, I made the decision to stop the concert and send everyone to their cars."]
Sugarland is now being blamed for the Indiana incident, together with their "members, agents and employees.” Is it common that people working for the artist are being named in lawsuits?
That is more of a newer issue. In the olden days, what would happen was the policy would include a lot more on the bands. (Insurers) would include the representatives of the band in their definition of who is a named insured. (The policy) would actually say a band’s agents, their assignees and so on.
Nowadays, they (insurers) have pulled a lot of that wording out. Everybody was being sued together on one policy, and it was being responded to on that. Now the policies for the bands are no longer covering everybody, and they (managers, agents and employees) are finding that they are being called into these suits, and they have no coverage themselves.
Sue everybody--a scattershot approach.
I always say that if there’s a big enough loss, everybody in the world is going to be named in that suit. I don’t know if it’s a world-wide phenomenon, but it is definitely a phenomenon in the United States. I don’t know if it’s driven by lawyers who go after everybody. It’s almost as if the person is on the way to the hospital and they (law firms) have stationed a lawyer at the venue to approach (victims) and give a card right away to that person. I don’t know how it comes into play, but (people) do feel that everybody is entitled to monetary settlement for an accident.
I’m not unlike that either. If I was hurt at a concert where the stage fell or my daughter or my son were killed because of a stage falling apart, I probably would go in and sue everybody too. I don’t know if I would sue them because I want money or that “You took something of mine; I want something of yours” attitude or “I don’t know really who is responsible so I am going to sue everybody because they can sort it out” kind of mentality.
Insurance is expensive, and with the economy being bad, people tend to cut down on their insurance.
Yeah, there’s the attitude of “I don’t need that much insurance. It’s too expensive. Instead of carrying $20 million now, I will only carry $10 million.” So more and more, the different companies have less and less insurance because it’s cheaper. But, in the long run, it’s not cheaper in the event of a catastrophic disaster.
Particularly for the venue.
The way that I look at it is if you are going to have 20,000 or 30,000 people around you, plan for the worst. There have been claims that have been paid for something that has never happened--just allegedly happened, and (insurers) have paid.
You have been working in entertainment insurance since 1980. It seems that there is more at risk today.
Touring used to be more along the lines of, “Let’s have a concert. Everybody get together," type of thing. People would just put on the concerts. There was little thought toward the way that it looked or the stage they had or the type of equipment artists had. You put on a concert.
Now the touring entertainment business is a big business. It’s a big business that is driven by other businesses. There was money to be made, and anybody who could make money jumped into it (the concert businesses).
Now, I feel that the freedom that we used to have back when I first started doing insurance is a lot different. You see a lot more contracts. You see a lot more distribution (of insurance). Everybody has their particular niche. Back in the day, the band would get in their van and tour around, and they’d knock on doors of the venues, and the venues would say, “Sure, c’mon in. You can play here.” That’s what they did. Nowadays you have all different elements of touring. You have promoters, producers, personal managers, business managers, and the venues. So everybody has a part of (insurance) now where before it was a little more free and easy.
Years ago, there was basically insurance for performers, and for venues. It’s seems far more complex today.
When I started out, there were only two companies that insured artists, and bands. So we specialized in bands back in 1980. It was a little bit different. I can’t explain it to you. It’s the same risk. It is more technical now, and people sue for a lot more money.
After five died in Belgium when a storm swept in and toppled the stage at the Pukkelpop Festival, it was suggested that the economy had led organizers to book more unknown bands who may have overloaded the stage with equipment.
As an insurer, you would rather have someone going out on the road that has been touring for 20 or 30 years because they know how to tour. You have these kids who are going around in bands driving themselves from here to there. They are an unknown. They are a total unknown.
I had this one band that was brand new. They (the insurer) wanted to charge an astronomical amount of money for this band per concert. I kept saying, “But, they are new.” I was told they had done this and that and this is their music. Well, they started out at probably $250 per concert (for insurance) which is a lot of money. Then they were part of a bigger tour--a more organized tour with a promoter--and we were able to lower their per (insurance) concert rate when they were on that tour because we knew the mechanism behind the tour. As soon as they stopped that tour, and they went out on their own again, their premium went up. Let’s talk five years later, now that they have a track record. They might be one of the more volatile bands but their per concert rate is down to $80 which is normal.
[Five people were killed and more than 70 injured at the Pukkelpop Festival, near the town of Hasselt in eastern Belgium, after a stage collapsed during a heavy storm.An estimated 60,000 people were at the three-day festival when the storm broke on Thurs, Aug. 18, 2011.
The Chateau stage at the Pukkelpop Festival was destroyed when trees were blown over in strong winds and crashed into rigging.
The Shelter stage was also damaged, but is not thought to have caused any injuries. Some giant TV screens also fell down.
Though Pukkelpop organizers have been officially cleared of liability by the Hasselt Public Prosecutor, the festival may still face significant losses.
Festival organizers had taken out civil liability insurance for the event, but the Public Prosecutor's determination that the tragic windstorm at the festival was a case of force majeure (greater force) means that the festival's civil liability insurance may not cover the full damages suffered during the storm.
Pukkelpop is also grappling with compensating ticket holders for the event. The storm struck on the opening night of the festival, and the event's organizers canceled the remainder of the event.]
As an insurance broker, you must seek to work with bands who treat what they do as a business.
Well, it is a business. It’s a huge business. Back in the day, there was an old broker that I used to do his underwriting when I worked on the carrier side. He would go to the concerts, and he would take a quarter out of every admission for the insurance. He would take those quarters, and he’d be there for the (tour) settlement, and the settling of the insurance. This was back when people just went on tour. There was no business behind it.
But now there’s big business behind touring. There are sponsorships. A lot of these kids aren’t going to make money from just their music. They are going to make it off the sponsors. The sponsors want to see certain types of bands. Live Nation has really changed the way that music is understood and played with big concerts. All promoters want a certain type of act. Any type of promoter, any type of venue, and any type of sponsor; they want to have something that emulates something good about them too. Nobody wants to be known for somebody who is killing their audience members or destroying their property or hurting people or being reckless or negligent.
Many changes in concert security came from 11 people losing their lives at a concert by the Who in Cincinnati in 1979.
Not only that, but there had been people killed at the Rolling Stones’ concert (including one homicide and three accidental deaths at The Altamont Speedway Free Festival in 1969) with the Hell’s Angel. That happened too.
[Three decades later, on the open concrete plaza on the west side of U.S. Bank Arena in Cincinnati, there is no hint of the tragedy that unfolded there on Dec. 3, 1979.In the late '70s, the Riverfront Coliseum (as it was called then) had a reputation for unruly crowds. Fans reportedly threw fireworks during a Yes concert there in 1976. A year later, a seat-seeking crowd rushed a locked entrance before a Led Zeppelin performance, resulting in 60 arrests and numerous injuries.
The 1979 show was the Who’s first Cincinnati performance in four years. All of the tickets for the concert sold out in 90 minutes. The majority of tickets were for unreserved seats or festival seating.
As 7 p.m., the scheduled time for doors to open for the 8 p.m. show, passed, restless fans began pounding on the glass doors. But only a handful of doors were reportedly opened. In all, 11 people lost their lives that night. Each had suffocated in the stampede of the crowd.
After the concert, families of the dead and injured filed 33 lawsuits against the Who; Electric Factory Concerts; the city of Cincinnati; and coliseum management. The suits claimed negligence and sought more than $100 million in damages. All suits were eventually settled out of court.]
I think that now the difference is that there are today different people involved who take on the different segments of the risk. Like for instance, you were saying that people were crowding, and they were trampled to death (in Cincinnati). It was because they had decided to open the doors early. And, it was general seating. Everybody wanted to get in, and get the best seat possible. That was the general seating. And so, the insurance (companies) rewrote their policies based on that. If you had general seating, exclude it from claims arising from general admission, which was what it was called. Then everybody had to have a seat.
Pyrotechnics, the exclusion (in policies) was born by a particular claim or somebody was burned severely in the audience and filed suit. It was quite a big suit. I think that the person was looking up, and got something in their eye and went blind in an eye. So that spurred that exclusion.
But that (exclusion) was before. You have to understand that Great White had a pyrotechnics exclusion on their policy but because of the public’s outcry, the insurance company which was Traveler’s paid it. They just paid it. They gave their $1 million. They just wrote the check, and that was it. They didn’t want to hassle it. There was public opinion. They just wrote it. That was one of the bigger pyros exclusions, but that exclusion was there years prior to that happening.
[Stricter enforcement of fire codes helped make clubs safer after 100 people perished during the notorious Great White show in February 2003, when a blaze destroyed the Station nightclub in West Warwick, R.I.]
When I first started (in entertainment insurance) there were no restrictions on who could do fireworks. I got in trouble once because--it probably was Metallica who was going to be playing in some open arena--and they had these flame throwers. They were not going to be far enough away from the audience for the insurance carrier to be happy to give their okay.
What finally happened was the fire safety people in that town came in, and they restricted them from doing it also.
So I was saved.
Now, insurance companies make you provide them with certain information that makes them feel comfortable enough to provide you with the coverage for what we call contingent pyrotechnics. There are also now companies who specialize in pyrotechnics. The have licenses, have bios, and can tell insurers exactly what they are going to do. They know exactly what the pyrotechnics are going to do, and how they are supposed to act. They have coverage now. So we are spreading the risk again away from the band.
I think the insurance industry has safened up going to a concert. Since I started 25 or 30 years ago, the safety elements have greatly increased. The insurance carriers have asked for more and more safety measures to be put in place. We went through the mosh pits, and everybody getting hurt there. They put in “no mosh pits.” The gist of it all is to have all of the entertainment companies who are insuring the same risk to also agree on these restrictions.
There are now multiple players involved in trying to share limits on a policy when a loss occurs.
Everybody’s insurance carrier is asking them to remove the risk from their client. So if you have a venue, the venue’s insurance company is going to want to have the promoter be responsible for their responsibilities as a promoter. Therefore, excluding coverage for promoting on the venue’s policy; therefore asking the promoter to add the venue as an additional insured for any losses that they may get named in due to the negligence of the promoter.
On top of that, the artists are sometimes asked to be an additional insured on the venue’s (policy). So everybody is sort of adding everybody else as additional insured in respect to their own negligence.
Trying to keep away from the liability or limit it.
Yes. Everybody is trying to give it away. It works for the most part. It does. If the band throws something into the audience, and the promoter’s contract says they are not allowed to throw anything into the audience and yet they do, the promoter, of course, is going to be named in the lawsuit; the venue is going to be named in the lawsuit; therefore everybody is added as an additional insured. Therefore their insurance carriers don’t have to do anything because they were not negligent until they are found negligent.
So if my band throws something into the audience, and it kills somebody and I’m the venue, and I get named in a suit, I might be held negligent because I should have had a screen or I should have known that this was going to happened and I should have anticipated it and should not have had the first 20 rows occupied--that kind of a negligence thing. You can always be pulled into a lawsuit but you try to remove yourself as much as possible.
That goes for personal managers, tour managers, and roadies too?
Everybody. Also sponsors became a big part of the touring industry. The sponsors give a lot of money to the movement of the tour. It’s not uncommon for some sponsors to give some of the bigger artists $20 million for their tour. Just to have the rights to have it as “The Pam Weiser Tour of the Rolling Stones” or for the Pam Weiser beverage served at the Rolling Stones’ concert dates--or for signage. So what is happening now is that the sponsors are also being pulled into these lawsuits too.
Sometimes the sponsors are responsible (for a liability claim). I had a claim recently where a sponsor had a (promotional) item and asked the artist to toss it into the audience, and somebody was injured. Now we’re going to battle with them (the sponsor) because they don’t want to be in the lawsuit. However, they told our artist to throw it into the audience.
One of the worst losses that I’ve ever had was from something being thrown into the audience. Some band threw candy, everybody dove for it, and the girl underneath broke her back and is paralyzed. She was the one that suffered.
Back in the day when I first started writing insurance, the reason why tossing of objects was excluded on most of the policies was because a band member threw something into the audience that caused somebody a tremendous amount of medical issues. The drum sticks or whatever being thrown into the audience, it doesn’t matter what it is, it’s a matter of how the audience reacts to it.
For a major act doing 30-40 dates, you suggest $20 million in liability insurance
Oh yeah. Well, what happens is that when our bands go on tour there are several things that go into play. The promoter starts to put together the itinerary; sometimes the sponsors will come in, and if you are big enough, they might say, “We will put up $20 million for this tour.”
For smaller bands just starting out, a lot of times they will go to a promoter and say, “We need to tour. We want to get out there. Put a package together.” So the promoter starts doing that. Then the band usually goes into rehearsals—we have to insure that rehearsal—and then, as it starts going on tour, there are other insurance issues—not just liability. There’s auto liability for the trucks moving all of the equipment, for the buses that are moving all of the people, limousines, aviation—however we are moving the artists.
On top of that, they have to start thinking of workers’ compensation and how much they are going to need on all of their crew members and musicians; and they have to determine how much equipment they are going to be taking. Usually, the rental houses will ask bands to insure their equipment. So we end up insuring their equipment.
There’s also event cancellation insurance.
Event cancellation (insurance) comes into big play. I would say that even though it seems to be a big industry, that not even 50% of the artists that go out even take the non-appearance (insurance). It’s very expensive. We take out more non-appearances for the older acts. The people who you’d think might not be able to continue the tour. But the funny part is that the losses are generally on the younger bands. The older guys, they know how to tour. They have toured for years. They get up; they take it. The younger guys that buy the non-appearance are usually the ones that have the claims.
Settlements for non-appearance tend to be messy.
Sure. Every time there’s a loss on non-appearance, I know that everybody says, “This company will get it paid right away. Tomorrow, I will get a check.” But there is always going to be a problem trying to settle it. It is always difficult.
In any settlement, an insurer has to look at timelines, and the decisions made up to whatever happened.
Yeah, it just depends. There is a lot on the line. Generally, you are looking at $150,000 to $750,000 that these people (performers) get as guarantees for concerts. Certainly, $150,000 is doing pretty good; $750,000 is probably at the top level but I have seen a $1.5 million (guarantee) for a concert, but that was outside of the United States. So there’s a lot of money at stake. There are a lot of issues that come up. For instance, if someone hurt their back, and they can’t continue their tour. Then they (the insurer) does some digging because they don’t want to pay $5 million or $6 million. So they go digging, and they find that back when you were 21, you were hospitalized when you fell off a ladder, and you hurt your back. But you never told us. You never declared that to us. Although you are 50 now, and your back is hurting, insurers will come back, and sometimes deny the claim.
So there are always issues when it comes to a lot of money, and non-appearance. God forbid that you should have a heart attack onstage. If you have never had any heart trouble, and you have a heart attack onstage, it’s the best thing because (insurers) can’t dispute it. You really had it. You are in the hospital, and there’s nothing you can do, and you never had heart problems before. Okay, boom, you are covered.
Some insurers won’t insure people who have had heart problems.
What they will do with the non-appearance, unless you are a total medical mess, they will carve it out. They can say, “Your right foot was broken 10 years ago, you still limp, and you can’t perform because sometimes your foot hurts.” So okay we will insure you for everything else except for your foot or any pathology leading to a missed concert because of your foot.
Do you do medicals?
Yes, we do medicals.
How about insuring someone with known addiction problems, whether alcohol or drug related?
Well, every application—and what we are dealing with on non-appearance as well as with medical, worker’s comp, life and disability coverage—on every single application—not worker’s comp so much--you are always going to end up with a question on the application to be signed by you about illegal drugs or prescription drug addiction.
So you either tell them the truth or you can lie.
If something comes up (without telling the insurers), you are denied coverage or you are not paid on the claim. As far as non-appearance, there is definitely a question on the medical that does address that issue. Sometimes on non-appearance, (insurers) will allow you not to fill out an application, but you have to say that you are in good health and there is no question about drugs at that point (in your life).
With films, that’s been an issue in insuring actors.
One of the biggest issues that I ran into was when I was working for an insurance carrier, and River Phoenix died of the overdose (in 1993). He was in pre-production (of a film). He was through with one movie (“The Thing Called Love”) and was in pre-production with another movie. We ended up having to pay something like $8 million. The insurance company sued, and went to court. The court came back and, basically, said, “You know of the risks of these types of actors. You know that they have drugs. You need to be aware of them.”
The insurance company had to pay.
We are aware that in Hollywood that actors and actresses and (music) artists do drugs and even though they have never done drugs before, and it’s not on the application, they do occasionally do it. So we lost that case.
With musicians, if they are known drug abusers, if they are known for that, I would say that their chances of getting any type of insurance that would cover that would be very, very small. (Insurers) will just carve it out. They will say, “everything else, except for addiction to drugs or illegal drugs or whatever.”
How in the hell does Keith Richards get insurance?
I’m sure that they have covered him over the years. But the thing is you can say, “The Rolling Stones have been around for 40 years, and they have only missed a handful of concerts because of illness, and not because of drugs.” So you can go back and say, “He was rumored to have done drugs, but he doesn’t do drugs anymore.” Or “he never missed a date” or “he only does pot or whatever.” The underwriters are human. So they understand that. They are not going to totally exclude everything; it’s a lot of money to them. Here you have a group that has this great touring record. So you are going to take that bet. It just depends on the group really.
How did you get into the insurance field?
I was born in Hollywood, and raised in the San Fernando Valley. My mother is a musician, and my father was a salesman. I grew up in a music world. I knew a lot about music, and I knew a lot about the recording industry because my mother (Phyllis Weiser) was a studio musician, and played with bands. She never did anything big, but she did back-up, rehearsal work and worked. She is a pianist and she also worked for the L.A. City School district as a music teacher.
She grew up in Hollywood with all of the actors and actresses. She went to Hollywood High, and hobnobbed with the Hollywood people. So I learned the passion for the music industry from my mom, and my dad, who was a sales person, taught me how to sell.
I first worked for my dad, and then I moved on. One day, I answered an ad for a company that was re-locating close to my house, and they said it was an entertainment based company. I went and interviewed and I got the job. I ended up working for a company that I would say was responsible for starting the entertainment insurance industry. It was called ANGA (American National General Agencies). We worked with different insurance carriers including Chubb, and Lloyds. We insured anything to do with entertainment.
Momentous recently launched its Nightlife Division, a dedicated insurance unit for DJs, performers, promoters, and nightclub owners.
Music is growing and changing with every generation so the insurance industry needs to change, and adapt too. DJs are being asked by clubs to provide their own insurance, and they had no place to go. So Graham (Graham T. Orleans) put together a lower cost program for the smaller DJs that gives them liability coverage as well as some equipment (coverage). What was happening was that DJs were going into clubs and leaving their equipment overnight, and then coming back to find that their equipment was gone.
Is cyber liability something the entertainment industry should now be taking more of a look at?
Absolutely. I’m not the expert in this, but what we have been trying to do lately is to package media—we call it media errors and omissions—which covers parties for liable, slander, defamation of character, intellectual property.
If you are on the radio or being interviewed, anything you say or disseminate across the airways, cyber liability does play into that. Cyber liability can include any social media out there. Anything that goes over Twitter, Facebook, MySpace and so on.
Artists say things that they don’t necessarily mean to say, and sometimes they are drawn into a lawsuit. It’s usually a legal battle, and that is what is expensive is the legal. We have, of course, paid a settlement because of the negligence of the artist, but a lot of times this coverage provides legal fees just to defend the allegation.
So, with our artists, what we do is put together a media which will include cyber liability as well as personal appearance, the music that they write if you are a composer, and any type of live performance that they might be involved in.
Employment practice liability is more common today as well.
Most bands are carrying that now for termination problems, and everything else, including for sexual harassment.
Yeah, it actually can. It covers third parties. We had a club which denied someone (entrance). The club owner said that they were ugly. They sued him and he ended up paying (the claim) on the employment practice liability coverage because the club had third party coverage.
So I can take out a policy insuring against a claim of bondage sex with a groupie on the road?
You can but you have to make sure she signs a form saying that it’s consensual.
Larry LeBlanc is widely recognized as one of the leading music industry journalists in the world. Before joining CelebrityAccess in 2008 as senior editor, he was the Canadian bureau chief of Billboard from 1991-2007 and Canadian editor of Record World from 1970-89. He was also a co-founder of the late Canadian music trade, The Record. He has been quoted on music industry issues in hundreds of publications including Time, Forbes, and the London Times. He is co-author of the book “Music From Far And Wide.”