Wrap-Up Insurance Deductibles: Are You Leaving Money on the Table?

By: Denise Gilmartin, VP, Business Affairs, AICP

If your project is insured through an advertising agency or advertiser wrap-up insurance program, the agency or advertiser should provide you with an addendum to the production agreement that states you are being provided insurance for the project as a “named insured” on a primary noncontributory basis, and that the agency or advertiser is responsible for all premiums and deductibles associated with the wrap-up policies. 

It has come to our attention that some wrap-up insurance carriers might not be seeing all claims submitted for reimbursement and that AICP members are being told their claim is denied because the amount falls under the deductible.

It is important that all claims be submitted to the insurance carrier for adjustment (click here for sample claim submission language). The carrier should provide you with a claim report that the claim is (a) not covered, (b) covered, (c) covered but below the deductible, or (d) additional information is needed to make a claim determination.  If your claim is denied (i.e., not covered), the carrier/loss adjuster must cite the specific policy wording used to make the claim decision.

Please note, the advertising agency or advertiser, as the case may be, is responsible for all deductibles for covered claims under the wrap-up program.  If you have a covered claim that falls under the deductible amount (e.g., the policy deductible is $10,000 and your claim is for $2,000), then the agency or advertiser should reimburse you for the claim.  

The only instance where you would not be entitled to reimbursement of the deductible is one where the claim wasn’t covered no matter the amount. For example, if the creative called for intentional damage to a car and a claim was made for that damage, the claim would most likely be denied no matter the amount. Whether the claim is below or above the deductible amount is irrelevant. The claim is being denied because it is not a covered claim.  

If the claim is a covered claim, but below the deductible amount, the agency or advertiser should reimburse you for the claim.

If you have any questions regarding this article or any other business affairs issue, please contact me at deniseg@aicp.com.

Click Here for sample Wrap-up Insurance Claim Submission Language.

This information is designed as a service to AICP Members and is intended only to provide general information on the subject covered and not as a comprehensive or exhaustive treatment of that subject, legal advice, or a legal opinion. Members are advised to consult with legal counsel and other professionals with respect to the application of the subject covered to any specific production or other factual situation.