What is an E&O Policy and Why Do Distributors Require It?
E&O insurance protects against lawsuits arising from a film's content — and distributors require it before signing any deal. Here's what it covers and how to get it.
E&O stands for Errors and Omissions — a type of professional liability insurance that protects against lawsuits arising from the content of a film. Copyright infringement, defamation, invasion of privacy, unauthorized use of music or footage, failure to obtain proper releases — these are all claims that E&O insurance is designed to cover.
If you want your film to be distributed through any significant channel — streaming platform, theatrical, television, or home video — you almost certainly need an E&O policy. Distributors and platforms require it before they'll sign a distribution agreement.
What E&O Insurance Covers
The core of an E&O policy is protection against third-party claims related to the content of your film. The most common claims covered include:
Copyright infringement — someone arguing that your film uses their music, footage, or intellectual property without authorization. Defamation — a claim that your film portrays a real person in a false and damaging light. Right of publicity — unauthorized use of a person's name, likeness, or voice for commercial purposes. Invasion of privacy — depicting someone in a way that violates their reasonable expectation of privacy.
The policy covers your legal defense costs and any settlements or judgments up to the policy limit, subject to the deductible.
Why Distributors Require It
When a distributor acquires your film and releases it to the public, they take on liability for its content alongside you. A copyright claim filed against the film affects both the filmmaker and the distributor.
Distributors require E&O insurance to ensure that if a claim arises from the content of your film, there's an insurance policy in place to cover the defense and any resulting judgment. Without it, the distributor is exposed to liability with no financial backstop.
Most streaming platforms, television broadcasters, and theatrical distributors have standard E&O requirements — minimum coverage limits, deductible maximums, and naming requirements for the policy. These are non-negotiable terms in distribution agreements.
The Clearance Process
Before an E&O insurer will issue a policy, they typically require a chain of title review and a clearance report — a legal analysis of every element of your film that could give rise to a claim.
The clearance report covers music licensing, footage licensing, talent releases, location releases, trademark clearances, and any real people or real events depicted in the film. The insurer uses this report to assess their risk before issuing the policy.
This is why the clearance process should start well before you're negotiating with a distributor. Discovering an uncleared music cue or missing release at the clearance stage can delay or derail a distribution deal.
What It Costs
E&O insurance for an independent film typically runs between $2,000 and $5,000 for a standard policy with $1 million per claim and $3 million aggregate coverage. The specific cost depends on the film's budget, content, and the insurer's assessment of risk.
Budget for E&O as a line item from the start of production. It's not optional if distribution is the goal.
