Red Insurance question: rental business

[omar robles]

So myself and a friend are planning on purchasing a red soon. So myself and a friend are planning on purchasing a red soon. We intend to rent out the red to help cover the cost of the purchase. However we are new to this and are in the process of gathering as much information as possible. We have understandable concerns about handing out our expensive investment to strangers. So my first question is insurance.

 

[omar robles]

any advice would be appreciated

 

[michael zaletel]

any advice would be appreciated

In my limited experience, here are some tips.

1. Make sure you clearly mark each and every piece of your gear. Perhaps a particular sequence of red or blue dots made with nail polish that so they can be removed later if desired. Many projects will have multiple camera packages rented out from different places and this helps to make sure you get your own "cared-for" gear back.

2. Most people create a production company to shield themselves from liability but you can require the owner or person-in-charge to also sign your rental agreement and assume full responsibility personally. In other words, get a personal guarantee from the person likely to have the most assets in addition to the insurance in the production company name.

3. Photograph your gear in detail from several angles in good light each time just before it goes out. Just lay it all out on the floor and photograph and video everything they are taking so you have a good record. When they return, verify your photos and videos against the inventory returned.

4. The biggest (and most common) problem is actually when the damage is minor. Bolt stripped, something scratched or dinged, cable damaged. When the repair or replacement cost is minor, they are not likely to want to pay for it or may just be so strapped after all other costs they can't readily reimburse and yet they don't want you to submit to insurance company because their rates will go up on next rental. It's not going to be worthwhile for you to sue them. Sometimes they'll be willing to give you some piece of gear you need to cover the cost. My recommendation is that if you rent out your gear, don't spend any of the money until after everything comes back in original condition. This way you have those funds for the minor repairs if they try to get out of paying for them.

5. Definitely require an insurance certificate, double-check the company name and details on the insurance certificate and even call the insurance agent listed to verify details and understand your coverage and their deductible. Sadly enough, many independent film producers do not have the money to cover their insurance deductible after production is finished. In the case of major damage, it could be some work and headaches to actually get paid. He said, she said. Make sure you document everything. Have them sign off on inventory list when they pick-up and verify everything when they return that day or evening. Send a fax or email as soon as you have a list of any items damaged or missing as a paper trail for your claims.

The best advice I can give is to go with your gut feel on who you rent your gear to. Ask yourself, do I trust the person in charge, do I know and trust the person that will be in charge of and operating the gear day-to-day. If not, it's not worth it.

Lastly, I wouldn't count on rental income to help you pay for your gear. Think of the rental income as a way to help buy new accessories, lenses and etc and to pay for future upgrades and maintenance. If you cannot afford to buy the gear without rental income, you should probably avoid the risks.

-michael zaletel

 

[omar robles]

Thanks for the advice.

Although now I am a little reluctant to go the rental route. It seems its not worth the risk.

 

[James McLellan]

A few things to consider:

Who are you planning on renting to? Major productions that shell out $2500/day and up for cameras do not want any risks. Do you have more than one camera? How fast can you fix firmware problems? 24 hours a day? If you can't provide these services you should consider that you might never rent your camera to a major show.

That would leave a lot of non-union jobs that are limited to much smaller rental rates. I see a lot of people buying these cameras because they think they will make a bunch of money off of it because they can undercut the big equipment rental houses through a low overhead. In the end I have observed most of these arrangements don't work out.

That being said I think the most important thing is to be realistic with your business plan. Clients won't appear out of nowhere just because you have a red. Think about it seriously. I am not in the rental business at all. These are just my observations. In fact I'm mostly a hobbyist and quite happy that way.

My 2 cents.

 

[omar robles]

James just curious. Do you own a RED? If so how did you come to the decision of spending a lot of money on something you consider just a hobby?

 

[James McLellan]

I run a small filmmaking program out of a high school in Winnipeg. We have a Red and use it to teach the students. This is an unusual situation I know but as a tool it is profoundly easier to teach photography and filmmaking skills with a red one as opposed to an ex1(3). A lot of research went into our decision and we are quite happy.

 

[michael zaletel]

It's cheaper than most ski boats and a lot of guys buy $35,000 trucks when they could drive an old Ford and shoot on RED.

-michael zaletel

 

[Tim Duran]

Omar, you see a lot of people making a lot of money renting their Reds out? Really? Do some research. First, some of these people only rent out packages including themselves and perhaps a crew with their camera. Secondly, I would venture to guess that nearly half of the Reds out there are still in boxes because the buyers didn't understand that buying a Red was only the down payment when it comes to other equipment you need to have a rentable unit at a decent rate. Other Reds are gathering dust because their owners are right brained creative types and can't understand how high tech operating a Red is (ie: it's not your point and shoot camera by a long shot). And this says nothing about learning to process your images after you get them on a disk.

The camera is great and I have several. But the learning curve is horrendous. And if you can't talk shop with your customers and give them some tech support, why would they want to rent from you?

That being said, Michael has given you some good pointers. About a year ago, there was a great thread on renting, rental agreements, offering credit, deposits, insurance, lots of good, on point, info. It's worth trying to find it.

 

[michael zaletel]

This one?:

Red Rental Legal Issues
http://www.reduser.net/forum/showthread.php?t=32533

-michael

 

[Joe D'Arcy]

So myself and a friend are planning on purchasing a red soon. We intend to rent out the red to help cover the cost of the purchase. However we are new to this and are in the process of gathering as much information as possible. We have understandable concerns about handing out our expensive investment to strangers. So my first question is insurance. ...
thanks for the time

In relation to insurance-make sure your rental insurance covers for fraud as well as theft. A few Redusers have been stung once their Reds were stolen on rental with false ID as this comes under 'Fraud' as opposed to 'theft.'

Also take a digital of renters along with photo ID.

Good luck
-Joe

 

[Antonio Forjaz]

I have had my RED for nearly a year and I have never rented it out. Some have asked to rent it, but I am reluctant to do so. The RED for me is a personal camera, my camera, for me to shoot my projects, so rental is kind of a mute question. I do rent it out, but only if I am operating it. I think that if you are buying a RED you must not count on rental, but on the work you will do with it. I have many other cameras, which I rent all the time, and I really don't fell attached to those cameras...I don't know about other RED owners, but it is like a son to me.It is special.