In the supermarket you rarely meet people who still voluntarily wear mouth and nose protection. Corona is over for many, even if the infection numbers prove the opposite. But there is one profession that the pandemic continues to make extremely nervous – even if you don’t necessarily think of it first when you hear the tiresome topic: we’re talking about film and television producers.
Their concern has a lot to do with the nature of a film production, but also with the insurance industry and with the slowly grinding wheels of German federalism. Cinema and TV films are made according to strict shooting schedules. The course of each scene, each camera perspective is fixed long before the director calls “Action”. Everything has to be right on the set. Dozens of specialists work together like clockwork to ensure that there are as few delays as possible.
A professional production can still cope with the failure of a cable carrier. But if the main actress can’t get in front of the camera, then in the worst case everyone else involved won’t be able to continue working either – they will still be paid, as will the rent for technology or film locations. Losses in the five to six-figure range can quickly add up for missed days of shooting.
The insurance companies do not cover corona failures
Normally, the production companies take out insurance for such shooting failures. And they would like to do the same for Covid-19 related outages. But while the general population’s fear of a serious infection has obviously decreased, the insurance companies are sticking to their point of view: the pandemic is force majeure and the damage caused by it is not insurable. Politicians had therefore created an alternative to this insurance gap with the so-called Default Fund II. But that expired at the end of June for TV productions. “This is a catastrophe for the security of film and television productions in Germany,” says the managing director of the German producer alliance Björn Böhning: “Productions are becoming a corona gamble.”
The politicians had already found a solution that the producers could live with. After a long struggle, two default funds were agreed at the end of 2020. These basically work like insurance for Corona-related production losses, except that the state, not the insurance industry, steps in. Default Fund I is intended to secure the production of cinema films and high-end series, including series such as Babylon Berlin. This first fund contains 50 million euros, which is mainly provided by the federal government and to which the federal states contribute. The federal government is extending Default Fund I until the end of March 2023, announced the Federal Commissioner for Culture and the Media Claudia Roth in June. On the other hand, there is uncertainty about the second corona insurance program, Default Fund II.
This pot is intended for television productions and is filled by the federal states. Since it expired at the end of June and the renewal is still uncertain, TV producers are nervous. How should they secure their television productions in the future?
The fact that TV productions are worried is due to federalism
The question is also relevant for people who only go to the cinema and have not had a TV in their living room for years. After all, German cinema and TV production companies are inseparably intertwined and dependent on one another. In addition, the market for German television productions is significantly larger than that for German cinema productions. A single cinema production is usually more expensive than the average TV production. But overall, the production companies make a turnover of around 500 million euros per year with cinema and around two billion euros with television. Accordingly, there are also more possible breakdowns in television that need to be insured.
The cinema producers can now look to the next few months with relative ease. The fact that her TV colleagues are still worried is due to federalism. Because radio, and thus also television, is a matter for the federal states. And as is so often the case with federalism, things quickly become complicated and fragmented, and joint decisions are a long time coming. Default Fund II expired at the end of June. Since then, the website of the film funding agency has stated that “some” of the countries involved are aiming for an extension. It is unclear what these are.
So far, television productions have only been insured against corona failures in those federal states that had made a financial contribution to Default Fund II. From December 2020 onwards, these were Bavaria, Berlin, Brandenburg, Hamburg, Hesse, North Rhine-Westphalia, Saxony, Saxony-Anhalt and Schleswig-Holstein. Baden-Württemberg and Thuringia joined later.
Together, the federal states provided 48.5 million euros to replace production losses. Production companies that did not have their headquarters in one of the federal states involved received nothing in the event of damage. In addition, the aid per federal state was capped at the respective state’s share of the overall package. For example, the large media locations of North Rhine-Westphalia and Bavaria contributed the majority of the sum with 16 and 15 million euros respectively, while Thuringia’s contribution was one million. After Default Fund II was extended for the first time in September 2021, Thuringia dropped out entirely.
The Default Fund II has so far been relatively cheap for the federal states
The money was to be used to settle up to 57.5 percent of the damage in the event of Corona-related shooting cancellations, 32.5 percent had to be borne by the client. The TV production companies are left with the remaining 10 percent, but at least 10,000 euros. So far, the default fund II has been relatively cheap for the federal states compared to the funds they had reserved for it. A spokesman for the State Chancellery of North Rhine-Westphalia states that around 500,000 euros have been paid out in his state since the start of Default Fund II. So there was 32 times more money available. Producer Björn Böhning explains the fact that the state corona insurance was relatively little used with the high hygiene standards that are enforced on the set. “In addition, the producer makes his own financial contribution and, despite all the risks, will always try to make the productions take place by making changes,” he adds: “So he will only apply for the cancellation funds if he really needs this insurance.”
About three weeks after Default Fund II expired, Böhning showed a lack of understanding that the federal states, especially the strong production states of Bavaria and North Rhine-Westphalia, are still hesitating against the background of the limited risk they face. After all, a decision is in the offing. “I’m glad that countries like Berlin and Hamburg are signaling that they are ready to extend Default Fund II,” says the producer. The State Chancellery of North Rhine-Westphalia states that the final decision on further participation has not yet been made. From Bavaria it is said that the extension is still being examined. We intend to continue to support film and TV production. If the countries should agree, the protection could also be applied for retrospectively.