Allianz Global Corporate & Specialty SE (AGCS) is rolling out the red carpet for its Entertainment insurance division in Asia with a launch in Singapore.
With nearly half of the world’s movie production taking place in Asia and large-scale live events and music tours on the rise, Entertainment is an important growth sector in Asia as more organizers look for insurance solutions to protect their events and productions.
In the area of events, AGCS insures concerts, festivals, tours and sporting events, taking over the financial consequences of an event failure or liability claims. AGCS can also insure the cancellation of events due to emerging risks such as pandemics and terrorism. In addition to the reimbursement of damages, AGCS also advises event organizers on film and event risk management.
Since integrating Allianz’s US subsidiary Fireman’s Fund in 2015, AGCS has been expanding its Entertainment division to support customers in new markets beyond North America.
In Asia, the first phase of expansion includes Singapore, Hong Kong and China.The Entertainment product line is the latest addition to a growing AGCS Asia book that contributed 6 per cent to overall global premium volume of EUR 7.4 billion in 2017. Damian Kerin, Head of Entertainment Asia Pacific, will oversee this new division.
Mark Mitchell, Regional CEO AGCS Asia, said: “The film production and event industry is a thriving and fascinating business in Asia. Allianz has offered Entertainment solutions for decades in the US market and successfully expanded to Europe recently. Now we are targeting Asian markets with our expertise and market-leading solutions for film and events insurance. The Entertainment line is a good fit for our portfolio of offerings to clients, as we already offer complementary solutions which support the film and events industry such as cargo insurance for touring acts. We also see an increase in clients organizing events, commercials and advertising so our Entertainment product allows us to offer them a full set of solutions all under the AGCS brand, providing them with wide coverage, global reach and financial stability.”
Growth opportunities in Asia.
According to PWC, the Media and Entertainment sector is estimated to grow by an average of 5 per cent per year globally till 2019 . In particular, AGCS sees significant opportunities in Asia, which is estimated to beat the global average and grow by an average of 6 per cent per year in the same period.
UNESCO statistics see Asia dominating the film industry, accounting for nearly half of the world’s movie production with 44% of movies produced in 2015.
The 47 stage Ramoji Film City in Hyderabad, India, spans 1,666 acres and holds the Guinness World Record for being the largest film studio in the world. The live music segment is also thriving, as global brands like US dance festivals Ultra Music Festival and Electric Daisy Carnival, and UK festival Creamfields have expanded and made their debuts in Asia in recent years.
Increasing Chinese investment in Hollywood, a rise in the number of co-productions and local productions will raise demand for Entertainment insurance in the world’s second largest movie market behind the US, accounting for 8% of movies produced.
From 2005 to 2015, China’s film production more than tripled, rising from 260 to 686 movies. On an international scale in 2017, China has invested over USD 5 billion in Hollywood. Dalian Wanda Group acquired US studio Legendary Pictures in 2016, making it the first Chinese firm to own a Hollywood studio. In the same year, Alibaba announced a partnership with Hollywood’s top grossing director Steven Spielberg to produce, distribute and finance films both in China and globally.
AGCS has already seen early success for its Entertainment line in the region, having insured the production of “Bleeding Steel”, a Jackie Chan film that was produced across various locations.
Live events fuel local demand
The rising popularity of live music acts in Singapore presents opportunities for AGCS to grow its Entertainment division, having seen risk inquiries locally from as early as 2015. According to PWC, total live music revenue in Singapore rose from USD 46 million in 2012 to USD 51 million in 2016, and is expected to reach USD 61 million in 2021, increasing at a rate of 3.4% CAGR over the period. The popularity of local music festivals in Singapore has seen global brands like Australia’s St Jerome’s Laneway Festival and Ultra Music Festival expand into Singapore.
Larger crowds are also prompting more organizers to seek coverage for their events. Not only are there more live events being held in Singapore, but a greater number of people are attending such events, leading to more complex and bigger risks.