Businesses use advertising to let customers know about their goods and services and find it a useful way to build a customer base and reinforce their reputation among existing customers. However, there are some exposures that come with advertising, which is why advertising injury liability is part of many commercial general liability policies. These are the top three exposures covered under that provision.
Invasion of Privacy
Many companies wish to use personal testimonials as a way to sell their goods or products. However, if a proper agreement was not struck between the advertiser and the client, the company may be exposed to an invasion of privacy lawsuit for damages of sharing a customer’s sensitive information.
Defamation of a person or business is another exposure that advertising injury liability covers. A lawsuit brought by parties claiming your advertisements damaged their reputations would be part of the policy’s defense cost coverage.
If your business uses copyrighted material in an advertisement without the producer’s consent, your policy would defend against the ensuing legal action. Sometimes, companies find themselves on the other side of these lawsuits because of a simple oversight like using clipart or a picture found online in an ad.
Advertising is a great way to grow your business, but it also is an additional liability exposure for your company. It’s important to have the proper coverage as part of any commercial liability policy.