CLASSIFYING RISK–MUSICIANS

(April 2019)

Musicians

A person standing in front of a piano

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INTRODUCTION

The Insurance Services Office (ISO) Commercial Lines Manual (CLM) does not have a specific musicians’ classification. This means that the manual must be reviewed carefully, and different classifications considered based on the activities of the individual musician in order to determine the most appropriate code.

STUDIO MUSICIANS

Many musicians work in recording studio settings so that activity should be used as a starting point. Class Code 47102: Recording Studios is rated based on total square foot area. Only one note accompanies this classification. It states that it includes sound editing but that motion picture studios must be classified and rated separately. This classification includes all activities that take place in the recording studio except those that relate to motion picture studios.

Note: This classification does not apply once the musician leaves the studio and performs elsewhere because it does not include or contemplate performances outside the studio.

PERFORMING MUSICIANS

ISO provides two classifications that apply to musicians who perform outside recording studios.

Class Code 43215: Entertainment Performed on Others' Premises applies to all types of entertainers, including musicians, who perform or provide entertainment for special private occasions or parties on premises of others. Examples are weddings and birthday or anniversary parties. The basis of premium is "each show." However, the note that accompanies the classification states that it does not apply to entertainers who perform on stage for the general public as pre-engaged entertainment. They are classified and rated as "Theatrical Companies–Traveling."
Class Code 99718: Theatrical Companies–Traveling applies to entertainers, including most touring musicians, who perform on stage for the general public as pre-engaged entertainment. The premium basis is payroll and includes the payroll of producers, other entertainers, and all other employees, in addition to the musician’s payroll. This means the company that organizes the tour insures the musicians as their employees. The note that accompanies the classification states that operations conducted at locations the insured owns, leases, or controls, or where it supervises seating arrangements or supplies ushers, ticket takers, and ticket sellers, are classified as "Theaters" and are rated separately.

Note: Any contracts between the traveling company and the musicians must be reviewed to determine and understand each party's responsibilities and liability. Musicians who act as subcontractors must provide their own insurance. If they are employees of a tour company, the tour company’s policy covers them. Each tour venue or site also has contracts that must be reviewed to determine the nature and extent of liability the visiting entertainers assume versus the venue's liability. In addition, any contract with middlemen or tour brokers that assist in booking entertainers must also be reviewed and the responsibilities and liability of those parties determined and understood.

INSTRUCTING MUSICIANS

Some musicians who give lessons work directly with or for a retail musical instruments store. Class Code 15538: Musical Instrument Stores applies in these cases. It includes risks that rent musical instruments as well as those that sell them and includes incidental sales of sheet music and musical instruments accessories as well as incidental offering of music lessons. Because ISO does not define "incidental," the point where music lessons are no longer included differs from one insurance company to another, based on their interpretation of the term and comfort level with the activity's exposures. The premium basis for the classification is total gross sales, including fees received from any part of the business.

Class Code 67512: Schools–Other Than Not-For-Profit is a NOC classification. It is used when fees from music lessons are more than incidental.

PERSONAL LINES APPROACH

Some musicians offer music lessons in their homes. This is a home-based business that ISO and most other independently filed Homeowners programs exclude. However, coverage can be provided using HO 04 02–Permitted Incidental Occupancies (Residence Premises). This requires an additional premium charge for the additional liability exposure. In addition, the insured musician who has only a Homeowners policy should consider insuring the musical instruments under a Personal Inland Marine Musical Instruments Floater coverage form or policy. Coverage under the floater applies to musical instruments both in the home and away from it and is especially important in cases where the instruments are taken off site for performances.