Completion bond
Sometimes a film production needs to take out a completion bond. This bond guarantees to financiers that the production will be completed. And if completing the film ultimately turns out not to be possible, the completion bond makes sure the financiers get their money back.
Only productions with a budget exceeding €2 million may require a completion bond.
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What is a completion bond?
A completion bond is a guarantee agreement that a film producer enters into for the benefit of the production's financiers. By entering into a completion bond, the producer guarantees the financiers that the production will be completed. If, for any reason, the production cannot be finished, the bond ensures that financiers get their investment refunded.
However, a completion bond does not guarantee profit. That is a risk for the financier.
How does it work?
A controller, assigned by No Risk and the insurer, monitors the film production and intervenes when necessary. For example, if the producer is at risk of exceeding the budget, the controller steps in to ensure that spending stays within the agreed limits.
In the rare case that the producer is unable to complete the film, the insurer takes over the production, including all rights and obligations. This ensures that financiers either see the film completed or have their investment reimbursed.
Only productions with a budget exceeding €2 million are eligible for a completion bond.
Other insurance products for media and film productions:
Media production insurance
Every film production needs media production insurance. This policy protects against a wide range of risks, such as damage, editing errors, or lead actors being unable to perform.
E&O insurance
The content of a film production can lead to legal claims – for example, allegations of copyright infringement or plagiarism. An E&O insurance policy protects producers against these risks.