Instrument and Band Liability Insurance History and Update

February 1, 2024

Ken Shirk  -  AFM International Secretary-Treasurer

In the early mid-1980s, the administration of former AFM President Victor Fuentealba introduced a groundbreaking musical equipment insurance program designed expressly for professional musicians, and in particular, for musicians whose working environment placed their gear at higher risk—club and lounge players, traveling acts (whether steady or a series of one-nighters). These were musicians who insurance companies generally considered not risk-worthy.

At the time that the AFM’s program was created, instrument insurance coverage had been primarily limited to homeowners or renters insurance, and those policies didn’t cover equipment being used on the job. The AFM’s instrument insurance program was a revolutionary change. Coverage was all-risk, replacement value, at home, on the road, in the car or van, on stage at the venue, 24/7, anywhere in the world.

Over time, other organizations introduced copycat insurance programs, some of them cheaper than the AFM’s, and some with different benefit schedules, better or worse. Through all those iterations of pop-up programs, the AFM’s was considered the standard against which the others were measured. During some of our continent’s more cataclysmic events of the past decade— floods, fires, storms, hurricanes—subscribers to the AFM’s program learned how rock-solid our program was.

As the music business evolved, venues began to insist that bands carry their own liability insurance as a condition of getting hired. This placed a great amount of economic stress on musicians. In response, our insurer stepped up and designed a band business liability program to meet that need.

These two mainstay programs were underwritten by the New Hampshire Company, later merging with AIG, which has been with us since the beginning. Until now, that is. Upon this administration’s assuming the Federation’s reins in August, we found a notice from our group insurance benefits broker, AMBA, that AIG/New Hampshire was pulling out of the equipment and band liability insurance program entirely, not just the AFM’s. Although the program was profitable, apparently it wasn’t profitable enough to keep AIG interested.

AMBA sent notices of this unwelcome news to all the subscribers, and my office has kept locals apprised. But not all emails get read before they disappear down into the inbox black hole. And even when US Postmaster DeJoy’s post office delivers a letter to the correct address, it isn’t always recognized as something other than junk mail. This month’s column is intended to fill in any notification gaps.

Our group benefits broker has been searching for a replacement underwriter for our program for the past five months. We were advised in November that a new underwriter was interested, but two months later, as of this writing, that deal has yet to be inked. Our advice to members who are affected by this is that, if their policy has expired or is about to expire, or if they have new equipment that they need to cover now, they should seek out other programs through other organizations. No member’s gear should be unprotected while waiting for the corporate bureaucratic engines to warm up their ink bottles.

Our hope is that a replacement underwriter will be in place very soon. If that doesn’t happen, the International Executive Board will start an in-depth investigation into how to provide AFM members with an alternative cost-effective equipment insurance program that won’t fall victim to the stockholders of a profit-driven insurance company.

Stay tuned.

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