Key Takeaways
- General liability insurance protects against third party bodily injury and property damage claims
- Property insurance covers costs to repair or replace buildings, equipment and other property in case of damage or theft
- Professional liability insurance protects against claims of negligence or errors related to business operations
- Worker’s compensation insurance provides wage replacement and medical benefits for injured employees
- Commercial auto insurance protects vehicles used to transport employees, equipment and materials
- Cyber liability insurance covers costs related to data breaches and privacy violations
- Commercial umbrella insurance provides additional liability protection above primary liability limits
- Business interruption insurance covers lost income during temporary shutdowns from issues like natural disasters
- Bundling multiple policies can provide pricing discounts for smaller companies
- Online payment and quoting options make insurance convenient with busy performance schedules
- A single claim without coverage could potentially cost hundreds of thousands of dollars
- Review policy limits annually and renew as the business grows in size
Introduction
Businesses in the performing arts industry face unique risks depending on their specific operations. This article explores the top types of business insurance coverages that performing arts companies with NAICS code 711190 should consider to protect their business and mitigate financial risks. These insurance policies provide crucial protection for specialized equipment, liability concerns and income stability.
General Liability Insurance
General liability insurance provides protection for performing arts companies against claims of bodily injury, property damage and legal expenses. It covers crucial risks for their businesses from a variety of incidents and is an essential coverage. Some key benefits of general liability insurance for performing arts companies include covering costs of defending against lawsuits even if claims are later found invalid, demonstrating the business is responsible and reducing risks of lawsuits, and certain facilities requiring proof of insurance for the business to perform there. Common use cases where coverage would apply include bodily injury or medical claims from events, employees or volunteers, property damage claims from equipment or facilities, and legal defense costs if sued for injury or damages. Estimated annual pricing for general liability insurance for small performing arts companies is around $1,500.
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Based on typical industry standards, general liability insurance for businesses in the other performing arts companies industry (NAICS 711190) usually ranges from $1,000 to $3,000 per year. Pricing is often calculated based on factors like gross annual revenue, number of employees, types of activities or performances, and loss history. For a small performing arts company with under $500K in annual revenue and less than 10 employees, an estimated annual price would be around $1,500.
Estimated Pricing: $1,500
Property Insurance
Property insurance is an important risk management tool for businesses in the performing arts industry. It can help protect expensive equipment, structures, inventory and reimburse lost income from unexpected property damage or theft.
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Based on industry data, the average annual property insurance pricing for businesses in the NAICS Code 711190 (Other Performing Arts Companies) industry is around $2,000. This pricing was derived by looking at average property values, claims history, and risk factors for this type of performing arts business.
Estimated Pricing: $2,000
Professional Liability Insurance
“Professional liability insurance, also known as errors and omissions insurance, provides important protection for businesses in the performing arts and entertainment industry. This type of insurance helps protect companies financially against legal costs and claims resulting from negligent acts or errors related to their business operations and services.”
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Based on typical pricing data for professional liability insurance for other performing arts companies (NAICS Code 711190), the average annual premium is around $2,000-$5,000. This price range was derived by looking at average premiums charged by top professional liability insurers for companies in this industry taking into account factors like annual revenue, number of employees/performers, types of performances/shows, and claims/loss history.
Estimated Pricing: $2,000-$5,000
Worker’S Compensation Insurance
Worker’s compensation insurance provides critical protections for employees and businesses in performing arts companies where injuries can occur due to activities like rehearsals, performances, equipment operation, or technical work. It ensures workers receive medical and wage support if hurt on the job while protecting employers from costly lawsuits. The top benefits for businesses include wage and medical coverage for injured workers, immunity from lawsuits, promotion of safer workplaces and faster recovery times, tax savings compared to lawsuit costs, and stronger employee relationships. Common use cases involve coverage for injuries from accidents, repetitive motion, traveling, and other event-related hazards. Pricing averages around $2.20 per $100 of payroll based on industry risk factors.
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Based on national industry data, the estimated average pricing for worker’s compensation insurance for businesses in the Other Performing Arts Companies industry (NAICS 711190) is around $2.20 per $100 of payroll. This price was derived based on analyzing historical claims data for this industry and taking into account factors like occupational hazards, employee duties/risks, company size, safety procedures, etc. The price can fluctuate depending on the individual business’s risk profile and loss history.
Estimated Pricing: $2.20/100 of payroll
Commercial Auto Insurance
Commercial auto insurance provides liability protection and covers vehicles and equipment that performing arts businesses rely on for transportation needs. It is an essential insurance for businesses in this industry. The top benefits of commercial auto insurance for businesses in this industry include liability protection in accidents, coverage for vehicle damage, medical payments for injuries, rental reimbursement if a vehicle is unavailable, and replacement costs for totaled vehicles. Common uses of commercial auto insurance for businesses in this industry are to cover vehicles transporting employees, equipment, food and supplies to performances and events. The estimated annual cost for commercial auto insurance for businesses in this industry is about $1,500 based on common vehicle types, number of vehicles, mileage, location and other factors.
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Based on industry analysis and averages, the estimated pricing for commercial auto insurance for businesses in the Other Performing Arts Companies with NAICS Code 711190 would be around $1,500 annually. This price was derived using factors such as the types of vehicles owned, number of vehicles, mileage, driver history, location, and coverage limits. Vehicles are typically vans or cars used to transport performers and equipment to and from performances or events.
Estimated Pricing: $1,500
Cyber Liability Insurance
Cyber liability insurance provides important protection for performing arts companies that collect and store customer data. It helps offset unexpected costs from data breaches, lawsuits, and other cyber incidents so the business can focus on its core mission. Some key benefits of cyber liability insurance for performing arts companies include covering costs of notifying customers, providing credit monitoring and investigating incidents of a data breach, network security failures from ransomware or phishing attacks, system failures or equipment issues, legal defense costs if faced with lawsuits or regulatory fines following a cyber attack. The estimated average annual cost for a small to medium sized performing arts business is around $1,500.
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Businesses in the Other Performing Arts Companies industry with NAICS Code 711190 tend to have lower data security risks than many other industries due to the nature of their business operations. However, they still face risks from third party service providers and vendors as well as potential internal security incidents. Based on industry studies, the estimated average annual pricing for a cyber liability insurance policy for a small to medium sized business in this industry would be around $1,500. This pricing assumes basic coverage of between $100,000 to $500,000 and a high deductible of $2,500 to $5,000.
Estimated Pricing: $1,500
Commercial Umbrella Insurance
Commercial umbrella insurance provides valuable additional liability protection for performing arts companies. It covers risks above the limits of general liability and auto policies, helping to protect both businesses and personal assets from lawsuits.
Umbrella insurance is especially important for performing arts companies due to the risks of injuries during events and intellectual property claims. It strengthens overall liability coverage and enables operations to continue even if other policy limits are exhausted.
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Based on industry risk factor and average sales revenue for other performing arts companies, the estimated average annual pricing for commercial umbrella insurance would be around $1,500. Umbrella insurance pricing is usually based on underlying commercial general liability limits and annual sales revenue. For this industry, underlying CGL limits of $1M are common and average annual sales revenue is around $500,000. Given these factors, insurers would typically price umbrella coverage at 3% of the underlying CGL limits, resulting in an estimated price of $1,500.
Estimated Pricing: $1,500
Business Interruption Insurance
Business interruption insurance provides crucial financial protection for businesses in sectors like other performing arts that depend on consistent operations and revenue streams from shows, performances and events. It covers lost income and ongoing expenses if unforeseen events force temporary shutdowns that could jeopardize the viability of the business without this protection. This type of insurance is especially important for arts and entertainment businesses that rely on regular activities and events to generate revenue. Shutdowns due to issues outside their control from natural disasters to pandemics can interrupt cash flows, but business interruption coverage helps maintain operations and restart activities after an insurable event.
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Based on standard industry practices for pricing business interruption insurance, the estimated average annual premium would be around 1-2% of the total insured value. For a typical business in the other performing arts companies industry with an annual revenue of $500,000, and assuming the business interruption insurance insures 6 months of lost revenue, the total insured value would be $500,000 * 0.5 = $250,000. At an average rate of 1.5% of total insured value, the estimated annual premium would be $250,000 * 0.015 = $3,750.
Estimated Pricing: $3,750
Conclusion
Properly insuring a performing arts business through policies like general liability, property, professional liability and more can help protect the company’s assets, support continued operations and provide peace of mind knowing expenses from unexpected events will be covered. Maintaining adequate insurance is an important risk management strategy for businesses in this specialized industry.