General Liability Covers Advertising Errors & Reputational Harm

General Liability Covers Advertising Errors & Reputational Harm
Commercial general liability insurance is the most basic and typically the most important type of insurance that any business can protect themselves with. But there is more included in these types of policies than most people are aware of.
Two of the lesser known areas where general liability insurance usually offers at least some protection are liability cover against advertising error and reputational harm suits.

Insuring Yourself Against Advertising Errors
Some businesses, by their very nature, may require professional liability insurance in addition to general liability insurance – to get (among other things) additional cover against errors & omissions and advertising suits and the like.

But, for many, the advertising error cover in their general liability policy may be sufficient.

In today’s world, it’s not at all uncommon to be sued over such alleged mistakes as the following:

  • False advertising, where misleading statements are made about a product/service in an ad.
  • Slander/libel, which is speaking or writing false and defamatory things about another person or company.
  • Copyright infringement, where one company publishes copyrighted materials without the copyright holder’s permission.
  • Misappropriation, which means claiming or implying an endorsement from someone where none, in fact, existed.

Since these actions of a business can cause real financial damage to other entities, they are called “advertising injuries” and can become the basis of a costly lawsuit.

With the Internet, and especially social media, so prevalent in modern marketing, it’s easy to accidentally make an advertising error or to simply be falsely accused of one and sued anyway.

If a company knowingly commits false advertising or another violation, it won’t be covered by a general liability policy, but otherwise, you’re covered regardless of “guilt”.

Insuring Yourself Against Reputational Harm Suits
There is quite a bit of overlap between advertising errors and reputational harm since the former can be the cause of the latter. But nonetheless, reputational harm is a separate category in most general liability insurance policies.

You could be sued for libel or slander done apart from advertising, for malicious and false prosecution, for invasion of privacy, for wrongful eviction, or for a host of other specific alleged acts under the general rubric of “reputational harm”.

As reputation is key to the success of many businesses and to the “social integrity” and financial position of individuals, it is not uncommon for these types of suits to be filed.

Consider how fast a news report or a post going “viral” online can impact a corporate or individual reputation – it can happen in a matter of minutes. Anything freely available to the general public that wrongfully has negative impacts on a reputation can potentially become the basis for this kind of suit. And when identity theft or irresponsible sharing or insecure storing of personal information is involved, the stakes can get even higher.

You don’t want to needlessly run the risk of having your bottom line squeezed or your whole business sunk by one (possibly false) reputational harm or advertising error lawsuit. A good commercial general liability policy can help protect you against that fate!

To learn more about how general liability insurance works, including further details on advertising errors & reputational harm, contact Flagler County (FL) Insurance Agency today!