First you need to go to MyDocuments>DeadIsland>out>Settings where you should see 2 files: Audio & Video. A good thing to do would be to right-click Video and save it somewhere like your Desktop as a backup.
SOLUTION 1: Some people have luck with simply deleting the Video file and launching the game.
SOLUTION 2: For others, it just takes a few changes in the Video file to solve the problem