As an insurance broker I often receive phone calls from
individuals and organizations looking for general liability coverage.
The variety of these organizations run the gamut, from your basic
contractor to the adult model day care. But it is not this gamut that I
am concerned about, at least not for this article, it is the individual
and/or organizations that calls seeking general liability insurance for a
media related company and are unaware that they need a very specific
and obscure coverage called media liability insurance or communication
liability insurance.
Some of these individuals and organizations
include bloggers, web developers, radio show personalities, authors,
production companies, publishers and broadcasters of instructional
material, television and radio stations, motion picture companies, cable
and satellite broadcasters and the advertising industries electronic
publishing services as well as any other entities engaged in preparing
materials for publication, republication, and electronic publishing
services just to name a few.
Many of these individuals and or
organizations do not realize that they need media liability coverage and
worse off many insurance professionals don't even know that media
liability coverage exists or that the coverage is most likely
specifically excluded from their general liability.This coverage is
typically part of the general liability found in Coverage B, Personal
and Advertising Injury Liability, in a standard CGL (Commercial general
Liability) policy. Personal and advertising injury relates to liable,
slander, defamation of character, as well as copyright, patent &
trademark infringement. More often than not, it is only when there is a
claim, and too late that the individual/organizations learn that the
most important coverage for their operation, is excluded from their
policy, Media Liability. In most instances their search begins after
being instructed by a vendor or contractor to obtain liability
insurance. Nonetheless, there are some industry personnel that know they
need the coverage but have a hard time coming across a professional
that knows anything about the coverage or where to secure it.
In
either case, most of these individuals or organizations are at their
wits end by the time they find us. Most of which have been told that the
insurance they are looking for either doesn't exist or is unavailable
from the last dozen or so brokers or agents they have spoken with. There
are clear reasons for this frustration and even clearer reasons that
their search for media liability insurance leads them to so many dead
ends.
For most of us, insurance company familiarity stems from
advertisements, including, by and large those for AllState, Geico,
Nationwide and Liberty Mutual, none of which offer, at this time, any
variety of true media liability insurance. As a result, most people
become frustrated and dissuaded. Whereas media liability insurance
coverage is a very simple to understand form of insurance, nonetheless,
most captive agents do not offer it. For agents and brokers those that
deal primarily with home and auto insurance as a staple of their
business model, exploring and becoming proficient in such a specific
type of product is not germane to their own operations.
By now you
are most likely and certainly asking yourself, alright already, what is
media coverage? Media Liability Insurance protects you against claims
arising to from the display, communication, transmission or purveyance
of information in ways that may violate the rights of others. Media
Liability Insurance provides very valuable third party coverage against
liable, slander, defamation of character, copyright, trademark &
patent infringement, personal injury liability, invasion of privacy
claims or unfair competition claims that RESULT in financial consequence
or personal injury. Examples of these circumstances would include
printing a damaging statement about someone, making slanderous remarks
about an individual or a company's product, using someone's logo or even
the unlicensed use of a cartoon character in an ad or publication,
distributing illegally obtained photos of someone, or marketing your
product by making damaging false claims about your competitors'
products.
According to Citizen Media Project, which is affiliated
with Harvard Law School's Berkman center for Internet & Society, US
based lawsuits have surged 70% in 2008 from 2006. The cost to hire an
attorney and defend these allegations can range from $5,000 to at least
$100,000 in the event the case goes to trial."Of the 256 lawsuits dating
as early as 1994 through April tracked by the New Media Law Resource
Center, damages were awarded in 17 cases, totaling $43.9 million", said
Ron Coleman, a trademark lawyer at Goetz Fitzpatrick in New York. (1)
That
is an average of almost $2.6M per judgment, before legal costs. It has
been stated in various internet publications that 50% of adults are
members of social networking sites like Facebook, MySpace and Twitter.
Many times posts on these networking sites are written quickly and done
impromptu, many times these posts can be taken out of context and
because they are stored indefinitely can leave individuals open to
claims well into the future. This brings up another point; adults should
make sure that they have personal injury coverage on their homeowner's
policy. To add this coverage is minimal and in fact this coverage is
needed if you have or plan on getting a personal umbrella liability
policy. For an in an individual in a non-media related industry, this
coverage provides similar protection, but on a personal level. In a
recent case involving an internet blogging youth, the insured's daughter
hated math class as well as the teacher. The daughter made several
"disparaging" remarks about her teacher online. The teacher successfully
sued the parents and was awarded $750,000.
The problem with our
litigious society is that many times a claim or lawsuit may not involve
an error or omission. For example, a client may not be happy with
service or just doesn't want to pay a bill, they can bring a lawsuit or
claim alleging an error or omission, but their real objective is to
avoid paying for services rendered. In this case and all cases when a
lawsuit or claim is filed, the defendant still needs to hire counsel and
respond to the claim. In this case Media Liability Insurance typically
pays for the cost of defending this type of claim, which in may cases is
the bulk of the expense of the cost of the suit.
Today's media
liability policies, geared to the needs of growing numbers of firms with
communication exposures, are carefully underwritten by a substantial
group of insurers.
The following are some famous examples of suits that pertain to this form of insurance:
- In
1981 Carol Burnett was awarded $1.6M ($3.8M in 2009 Value) after the
suing the National Enquirer for describing her alleged public
drunkenness.
- In 2006 Chef Gordon Ramsey sued Associated Newspaper LTD for
alleging he 'faked some of his scenes' Associated paid Ramsey $138,000
and an apology.(2)
- By Alexis Leondis, The Star-Ledger (Newark, New Jersey),
"Blog Insurance Rises in the wake of Lawsuits", 10/04/2009, (10/28/2009)
- USA Today, [http://www.usatoday.com/life/people/2006-06-20-ramsay_x.htm], (06/21/2006)
Castle Rock Agency Currently Offers Media Liability Insurance in CA, CT, FL, MA, NJ, NY and PA.
Castle Rock Insurance Agency NY
212-360-2334
Castle Rock Agency
853 Broadway 1602
New York NY 10003
212-360-2334
