Navigating Insurance

Cultural institutions face unique risks. Patrons slip or fall at events. Credit card information becomes compromised. Artwork, stage props, and other property are damaged. Whether your organization is private or public, you should have an all-risk insurance coverage. This policy will protect from all physical risks of loss or damage from any external cause (policies exclude war and nuclear or radiation). The policy should cover accidental loss or damage stemming from a sudden event.

If you’ve never had insurance before or have had difficulty finding coverage in the past, don’t fret! There are companies out there that understand an artist’s career. Here are some tips to help you get started.

There are several types of insurance to consider: Business Personal Property Coverage, Liability Coverage, and other additional coverage depending on your circumstances.

Business insurance plans can include the following components: coverage for the physical structure of your studio and its contents, business interruption, your work and property while in transit, and the personal property of others in your care.

Liability insurance protects you if someone is injured while on your property or if your property causes damage to others. An umbrella liability policy goes beyond liability coverage and kicks in when all other liability coverage is exhausted, and is typically in $1 million installments.

Keep in mind that basic business insurance policies cover risks to property like fire, riot, theft, water damage, vandalism, and so on. It may be called “all-risk” coverage, but will more than likely have exclusions. Often times flood, earthquake and acts of terrorism are not covered in a standard insurance package so if you are at risk for these, investigate additional coverage.

To help an insurance agent understand your business, prepare a one to two page description of your background, experience and scope of operations. The agent will use this information to weed out underwriters who have little interest in your type of business.

Using information you have gathered during your risk assessment, make a list of these risks, whether or not they are insurable, from most serious to least.

Look for agencies that specialize in “commercial lines.” Ask friends and colleagues who they use that what their experience has been. Make sure to choose a representative you’re comfortable with, someone who is communicative and responsive. You can work either with an agent who represents a specific company or with a broker who works independently and represents you to the marketplace. Either choice is fine! Just be sure whoever you select understands your insurance needs and helps you to design a package that provides the level of coverage you need. Ask questions!

For more detailed information about insurance for individual artists visit the CERF+ Insurance Hub for individual artists.

While there are many types of insurance, here are five of the most important to consider:

  • Property, which helps protect the property a cultural organization owns and leases, including things like equipment, inventory, furniture, and fixtures. Coverage can also be tailored by the organization to fit the specific needs of museums, theaters, and other cultural institutions. This can include coverage if: unable to process electronic data; loses income because utility services are interrupted; business is unable to complete transactions because transmission lines are damaged.
  • General Liability, which helps covers property damage, including damage to rented properties, and accidents related to running a cultural organization. This policy can also help protect the assets of a cultural institution if it is sued for negligence, personal injury, libel, slander, errors, omissions, misrepresentation in advertising, and more. General liability automatically covers employees, and can easily be extended to cover others when needed.
  • Professional liability helps cultural organizations and the people who work for them pay for damages and defense costs if they’re sued because they acted inappropriately, made an error or omitted something important when performing professional duties. Because businesses can differ in size and exposure to legal risk, this coverage can be customized and tailored for different types of theaters, museums and other organizations.
  • Cyber Liability, a newer type of insurance that is becoming more prevalent and necessary. This helps cover common risks to cultural organizations including loss of data due to things like computer viruses, malicious code, or hardware theft as well as costs related to the loss or theft of identifiable employee, patron, and sponsor data including notifying impacted individuals, lawsuits, and public relations costs.
  • Finally, Active Shooter/Hostile event insurance. This covers liability and extra expenses tied to shootings, providing victim death benefits with additional medical expense benefits. The program also covers a wide range of attack-types, such as knife and vehicular attacks, rather than solely deadly attacks committed with a firearm, and extra expense coverage related to hiring of additional staff, public relations, counsel/crisis management consultant, or temporary security measures.