What is advertising injury?

You might think advertising injury only affects big corporations, but that’s not the case. Small businesses can be just as vulnerable to these unexpected legal issues.

From a slip-up in a social media post to a copyright infringement, the risks are real. Learn how advertising injury can impact your business and how to protect yourself.

Jump ahead to learn more about:

• What is advertising injury?
• What insurance can help protect against advertising injury?
• 7 tips to help avoid advertising injury claims
• How NEXT helps small business owners

What is advertising injury?

Advertising injury is when someone claims that you’ve harmed their reputation or infringed on their intellectual property in advertising.

Examples of advertising injury include:

• Reputational harm. If your advertising paints a damaging and false picture of other people or companiesand harms their reputation, you might get sued for defamation. If you harm their financial interests, you might have to defend yourself against claims of disparagement.
• Copyright infringement. If you use another company’s trademark or trade dress (how a product or service looks) without permission, it can lead to accusations of intellectual property infringement.
• Invasion of privacy. If you disclose someone’s private information without permission, you might trigger litigation.
• Libel. If you write something that harms a person or business’s reputation by publishing something untrue or damaging about them.
• Slander. If you harm a person or business’s reputation by saying something untrue and damaging about them. 

Say, for example, your flyers about your personal trainer business refer to you as ‘“The Rock.” The celebrity Dwayne “The Rock” Johnson sees them and his management team sues you for copyright infringement because you used his signature nickname.

Or let’s say your employee writes a Facebook post badmouthing the competition. He means well in terms of building up your business, but the competition hears about it and wants to sue.

Given these risks, it makes sense to follow advertising best practices, take necessary precautions and check with your attorney if you’re still unsure.

What insurance can help protect against advertising injury?

If your advertising is accused of hurting a person or company, general liability insurance can help protect against the loss of advertising injury. The insurance industry often combines advertising-related and non-medical claims into coverage called personal and advertising injury.

General liability coverage is the most common type of insurance for small businesses and the self-employed. Iit can protect you from some of the most common things that cause financial losses, including:

• Injuries to people who are not employees
• Damage to someone else’s property
• Accusations of libel and slander

A business owner’s policy (BOP) may also cover advertising injury liability. BOP insurance combines the coverage of general liability insurance and commercial property insurance.

What are common exclusions from personal and advertising injury coverage?

Your advertising injury coverage does not protect against all potential losses. For example, it won’t cover litigation resulting from:

• Crimes you’ve committed
• Contract disputes
• Misrepresentation of facts
• False advertising
• Actions of ad agencies, publishers and internet service providers (ISPs)

7 tips to help avoid advertising injury claims

While business insurance can help cover you from many advertising liability claims, your best protection is avoiding them altogether. A few things you can do to help prevent advertising injury claims include:

1. Fact-check everything. Ensure all claims, statistics and information in your advertising are accurate and verifiable. 
2. Respect copyrights and trademarks. Avoid using copyrighted images, slogans or logos without permission.
3. Consider advertising injury insurance. This can help provide financial protection in case of unexpected claims.
4. Obtain necessary permissions. Always get written consent before using someone’s image or likeness in your advertising. (Including property such as homes or pets.)
5. Be mindful of language. Avoid making false or misleading statements about competitors or your products/services. This includes claims in terms of your pricing such as “we’re the cheapest around,” or material claims, such as  “100% natural.”
6. Review your advertising regularly. Stay updated on advertising laws and regulations to prevent unintentional violations.
7. Train your employees. Educate your team about advertising best practices and the importance of avoiding legal issues.

How NEXT helps small business owners

Advertising is essential for business growth, and it’s crucial to advertise so that you don’t cause harm. In the rare case that you do, a NEXT general liability insurance policy can help pay for covered legal expenses.

NEXT is 100% dedicated to small business. NEXT small business insurance helps you take the risks you need to grow and scale your business.

Start a quote, customize your options and access your proof of insurance in about 10 minutes.

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