Words of wisdom from our business insurance experts.
There are more than 3 billion social media users worldwide and social media influencer marketing is projected to be worth roughly $14 billion this year alone, according to Influencer Marketing Hub. As this trend is on the rise, more and more businesses are tapping into partnerships with social media influencers from nano to mega-influencers to generate brand awareness, build campaigns, and ultimately drive sales.
So where does an insurance policy come into play?
Quite simply, it mitigates risk, protects your business from being sued, and helps maintain your reputation. Your standard commercial insurance or business insurance policy may not include product-related liability, defamation, or social media activities. But the social media influencers you choose to work with should have a social media influencer liability insurance policy in place to protect their brand, as well as yours.
What is social media influencer liability insurance?
This insurance policy protects the social media influencer or business from any potential lawsuits such as libel, slander, defamation of character, unauthorized use of intellectual property, plagiarism, or even invasion of privacy. It covers the influencer who is promoting the brand’s services or products that does not have a direct contract with the brand. As the value of social media influencers grows, so does the reputational and financial risk.
Liability insurance for a social media influencer is typically a combination of two policies - Professional Liability (E&O) and Commercial General Liability. We discuss each of these in greater detail later in this article, but these policies are essentially protecting the business if there is a claim due to a third party lawsuit. These policies can also have other essential coverage packaged together including Cyber Liability, Business Income, Business Property, and Workers Compensation Insurance.
If you're a business working with a social media influencer, this type of insurance policy should be required. Remember, it’s the deepest pockets who are always sued first. It’s essential to ensure the influencer promoting your business has the adequate insurance policies in place to defend your brand if a claim arises from the influencer campaign.
Who should have a social media influencer liability insurance policy?
Anyone who generates income from a social media platform. However, more specifically it should be:
- Nano-influencers (1-10K followers)
- Micro-influencers (10-50K followers)
- Mid-tier influencers (50-500K followers)
- Macro-influencers (500K-1M followers)
- Mega-influencers (1-5M followers)
- Professional Athletes
- Public figures
- Podcast hosts
- Thought leaders
- Media, sports, and news personalities
- Key business leaders
- Reality TV stars
- Game show contestants
What does a social media influencer insurance package policy cover?
Even though social media influencers have not been around for a long time, there are already laws being enacted to regulate promotional content on social media platforms. Let’s take a look at common liability risks:
The use of someone else’s intellectual property and/or work in your content without the rights to do so.
For example, copying any images or user-generated content (USG) without the creator's permission can be classified as infringement, even if you link back to their website or original social media content.
The act of making a claim about a product or service that is not true and someone cites your social media activity as the reason they used that product or service.
Please note, even if you don’t make any false claims about the product or service and company you have partnered with, you can be named in a lawsuit.
For example, a clickbait scam can lure a user with a call to action that potentially installs a virus on the user’s personal device.
Invasion of Privacy
The use of photos or videos where someone can object to their likeness being in the published social media content.
Publishing private information or images in public, is also part of invasion of privacy.
For example, publishing user-generated content (USG) as “art” for an exhibit without the consent of the user.
Libel or Slander Against a Person or a Brand
This is the written or verbal communication of false statements against a person or brand that unjustly harms their or its reputation.
For example, repeatedly stating on a social media platform that a brand is dishonest and corrupt, when in fact it is not.
Non-Performance of a Contract
If you fail to complete the contracted number of posts or content creation, even if a situation outside of your control is the cause, you could still be sued.
If you fail to uphold the contract where you are required to act or not act in a certain way that affects the business or brand’s reputation.
For example, an influencer was required by their contract to do three static social media posts for the campaign and only posted one within the contractual timeline.
This includes both property you may accidentally damage and damage that can happen to your own personal property, such as cameras, phones, computers, etc.
For example, the loss of your electronic devices due to a natural disaster like an earthquake.
What are the top 5 insurance policies that every social media influencer should consider?
Every content creator is different, so keep in mind insurance is not a one-size-fits-all kind of thing. For example, an influencer making explanation videos from their apartment is going to have a slightly different insurance portfolio versus an influencer with multiple employees and offices focused on car reviews.
However, in general, most social media influencers and content creators should consider the following policies:
Also known as Errors & Omissions Insurance, or just simply E&O, this is a form of professional liability that protects an influencer if they are sued for a professional error. For example, let's say you make beauty content and recommend your audience tries a new hard product. Turns out that hair product was recalled and the formula damaged someone's scalp. The injured person could file a lawsuit against the creator claiming they used it due to their recommendation. Learn more about E&O coverage at the link here.
Cyber Liability & Data Breach
If you use a computer or phone at any point for your business, you are exposed to cyber attacks. The number of attacks are outrageous today and our analysts do not see that number slowing down. The best example of a cyber attack typically happens within an email or text (although some attacks can happen without the user knowing). If you receive an email, click a link or open an attachment, information such as banking, personal, employee, and customer data can be stolen and exploited. Learn more about Cyber Liability Insurance at the link here (we promise it's safe).
Commercial General Liability
Do you ever meet with people? Perhaps you have vendors, partner, people who participate in videos, etc. If a thirds party slips and falls during the business hours, a social media influencer may be on the hook for injuries. A Commercial General Liability (CGL) policy protects the business if it is sued for third party bodily injury and property damage claims. Learn more about Commercial General Liability at the link here.
Cameras, computers, printers, audio, furniture, and more property owned by the business can have significant value after adding it all up. Protect all of your business property while it is stored at your home, office, or studio and while it's on the road. Learn more about Commercial Property Insurance or Business Property Insurance at the link here.
As soon as you tell another human being what to do is the moment you are liable if they are injured. There's a common misconception with business owners when it comes to deciding when to purchase Workers Compensation Insurance. Many states don't require it if you don't have W2 Employees or less than 3 workers. That simply means the state won't fine you, it does not mean your business is not responsible for worker injuries. If you have sub-contractors (1099's), part time, full time, volunteers, etc. you must consider a Workers Compensation and Employers Liability policy. Learn more about Workers compensation at the link here.
If you are a social media influencer or a business looking to partner with a social media influencer, make sure your brand has a solid social media influencer liability insurance policy that will save you time and money against all liabilities.
Fullsteam Insurance is the insurance brokerage that will safeguard your business with an insurance policy you can trust. Let our team of expert insurance advisors guide you through building and implementing a social media influencer liability insurance policy that will protect you when you need it most and offers the best coverage at a competitive price.
We work directly with you and customize an insurance policy to protect your customers, property, partnership, people, and more.
With Fullsteam Insurance you are always one-click away from speaking with an insurance advisor who can break through all the corporate jargon and tailor an insurance solution just for you. Our insurance experts work with you and your team every step of the way by reviewing quotes, negotiating the best terms, and have access to the most reputable insurance carriers.
The best part of Fullsteam Insurance is knowing you can rest easy and assured that as your company grows, we can grow with you.
Fullsteam Insurance works hard for your business with world-class customer service, cutting-edge technology, and industry knowledge. Our goal is to offer you insurance policy solutions with the best insurance carriers, broadest coverage, and competitive pricing.
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