(The following is excerpted from Best Business Practices for Photographers, Second Edition, by Black Star photographer John Harrington.)
I cannot imagine operating a business and going out on location without insurance. For many businesses — and certainly the government — you won’t be allowed to shoot within their property or purview without proof that you do have insurance and include them in the coverage.
So how do you do this? With a COI.
Certificates of Insurance
A COI is a certificate of insurance. It is almost always a single-page document that you carry with you (or usually fax/e-mail ahead of time) to the location where you are going to be shooting. The COI not only proves that you have insurance, but also what your limits are.
Often a facility or venue where you are shooting will require you to list them as an additional insured, which gives them a right to be protected under your policy while you are there. In this instance, you’d ask for how they’d like to be listed on the COI, and they would provide their official corporate name or government entity. Then you’d simply e-mail or fax that information to your insurer, and they would generate the proper form and fax one to you and one directly to the location.
In one situation, I wanted to be doing photography at Niagara Falls during the Millennium celebration, which included fireworks. This required a tripod. A call to my insurance agent the day before — late on a Friday — was all that I needed to add the National Park Service’s local division to the COI as an additional insured, and I was all set to make my photographs without any problems.
The federal government, many state governments, and even local governments will require a COI from you before you can shoot. There’s a place for the information on the forms you’ll fill out, as well as a requirement to attach the COI as a part of your permit application.
Frankly, private-property owners should always require a COI, and although many do, the majority of them do not know to ask you for it. On more than one occasion, I’ve used the fact that I carry liability insurance as a tool to secure an assignment.
During the dialogue with a client, when I am able to discern that I am bidding for an assignment, I’ll make a point of bringing to the client’s attention that a COI will most likely be needed, and not only can we provide that, but we do so on a regular basis.
I encourage the client to inquire of the other photographers whether they can also provide a COI, knowing that many can’t. On more than one occasion, I have been told that “all the other photographers had no idea what a COI was.”
Access to venues that would have been difficult or impossible to get into has been secured when I, or the client, discussed the needs with the property manager and volunteered a COI, offering to name the location as an also insured. It lets the property manager know that they won’t be on the line if something goes wrong. In the end, a COI is a required tool for on-location photographers everywhere.
Lastly, more and more hotels and other rite-of-passage event venues are requiring photographers to provide a COI and complete forms about their conduct while on site. I know from experience that even when photographing a friend’s wedding, the hotel planner at the Four Seasons in Washington D.C. required me to complete the forms and provide a COI, asking the bride-to-be whether I had insurance and such.
If you are (or hope to be) doing events of this nature at large hotels and palatial estates, having the right insurance will ensure that you don’t get disqualified just because you didn’t have insurance.
Errors and Omissions Insurance
Errors and omissions insurance, referred to as E&O insurance, is more overlooked than disability and long-term care insurance by photographers, yet it should not be. So, to that end, it is important that I convince you that you need E&O coverage.
E&O coverage protects you in the event that a client holds you responsible (and that usually means they are suing you or threatening to do so) for not delivering the results they were expecting or that you promised. This could mean that you completely failed to provide the services or that you provided them, but the client expected something different.
Just as your physician and your lawyer have malpractice insurance, so, too, should you have E&O coverage. They are, generally speaking, the same thing. It is very important to note, though, that E&O coverage, which encompasses professional liability coverage, is not the same as general liability. General liability does not cover things such as contract disputes, for example.
E&O coverage will mean that when you are sued, the costs for you to defend yourself in that lawsuit are covered, including settlements and, if a trial goes to the end and you lose, the judgment. Since everyone makes mistakes, having insurance to protect you against the liability of those mistakes can mean the difference between staying in business and going bankrupt.
To secure E&O coverage, call the company that is already insuring your business and ask them about adding E&O coverage. Be sure to inquire about dates of coverage available and consider the costs of retroactive coverage, which can be worthwhile. Sometimes, you’ll be asked to provide copies of the contracts you use (in other words, what you’re promising to deliver), and you may be asked to provide evidence of checks and balances you use.
For example, do you send your finished product via First Class U.S. Mail, which has no mechanism to track packages, or do you use a shipper that requires a signature to acknowledge that the package has arrived? If your current insurance broker does not offer E&O, they likely can direct you to a company that does.
As if health, life, auto, disability, homeowner, business, general liability, E&O and the rest of the insurance coverages weren’t enough, we have umbrella insurance. In point of fact, it is the very reality that those insurance coverages are not enough that means you need umbrella insurance.
Umbrella insurance is insurance over and above the insurances you already have. A March 8, 2008, article in the New York Times, titled “Umbrella Coverage for Preventing Your Ruin,” notes, “Umbrella and excess coverage are extensions of home and auto insurance. Banks make people buy home insurance to get mortgages, and states require drivers to buy auto insurance. But no one mandates buying a policy that could turn out to be the most important part of your insurance package.”
Costs for umbrella policies are nominal. For example, if you have auto insurance that has a $300,000 limit per incident and general liability coverage at a $1 million limit per incident, for anywhere between $100 and $300 a year, you can get coverage that adds $1 million to the protection of your auto insurance for a coverage limit of $1.3 million, and your general liability then covers you up to $2 million. The next million in coverage added on is even less.
Insurance and Taxes
A word about insurance and taxes: First, consult your accountant, but there are varying degrees of deductibility for health, life, and disability insurance and the like. Because businesses that offer their employees insurance can deduct that expense of serving their employees, the laws are changing on both federal and state levels about the percentage of deductibility of these insurance expenses.
Make sure you are maximizing your benefit by discussing the variety of insurance types with your accountant. Business insurance is deductible, so I see no reason why you shouldn’t have it.