In a major move to restart the film and TV industry, the UK Government has committed a £500m fund to unblock insurance issues surrounding Covid-19.
Since the outbreak that caused lockdowns across the globe, we have seen insurance companies have been risk-averse and the UK production companies have struggled to restart productions. Without the production insurance, any issues arising during the production heightens the risk to production companies. With a lack of companies offering competitive production insurance, the UK Government’s £500m fund has been set up to cover any future losses resulting from Covid-19. A payout is limited to 20% of the production budget if delayed, or 70% if production is abandoned.
Some productions have been able to progress. Over at Sky Studios, the lockdowns around the world paused 29 active productions. However, after Austria implemented a €25m insurance fund for production to restart and within weeks, Sky Studios would starting filming for Ich und die Anderen. It’s hoped that a similar timescale will be inherit in the UK too.
Film and TV production spend in the UK has been on a meteoric rise for the past few years, with £3.1b spent on UK production in 2018 alone. The size of the UK’s fund is impressive and indicates faith in the film and TV industries in the country. Screen Australia is distributing A$50m ($36m) of funding to restart productions, France doubled its fund to €100m ($117m) and Canada’s Quebec provincial government created a CAD$51m ($38m) – though this was administered to cover both insurance and increased production costs.
From our discussions with senior executives across the production industry, many were penciling September as the restart date for the indies. However, like many of the larger groups, ITV Studios has restarted around 70% of the productions impacted by Covid-19[1]. On the commissioning and broadcasting side, the likes of Netflix sees a return to near-normal production levels by September[2]. If this occurs, businesses supporting the production and delivery of TV and films should see an uplift in demand.
As production returns to a new normal, adhering to the new Covid-19 guidelines, the industry will face many more obstacles in the near-future, not least the increased production costs. However, with a insurer of last resort now in place, the largest blockage has been cleared and there is light at the end of the tunnel.
[1] https://www.itvplc.com/investors/results-centre
[2] https://www.ft.com/content/e2aef6e5-37d3-4b93-99d5-8964bc6d647b