Mercator Risk Services : Media Liability Insurance - Protection against claims arising from content of broadcasts, articles or advertisements.

E&O: Errors & Omissions

Media

Opportunities

The media liability segment can be a significant opportunity for new sales. The business is complex, as is the coverage required. Many smaller media organizations, particularly public relations firms and marketing consultants, do not buy professional liability coverage now. Typically this is because the professional questions the need or because they think that their General Liability coverage includes professional liability. In addition, media and technology changes are driving significant changes in coverage. It is sometimes difficult to keep up with the changes, but this can also create sales opportunities.

Exposure

Most media organizations carry professional liability insurance (E&O) to provide protection from third party claims. One of the principle exposures media organizations face is a libel/slander claim arising from their content. This is primarily contained in the broadcasts or articles they run and in advertisements they accept. The typical claim might involve a libel/slander action by a third party, holding the media organization responsible for the libel or slander.

Often, a claim or lawsuit may not involve a clear error or omission. For example, a client is not happy with the result and brings a claim to obtain a different result or avoid paying a fee. These types of claims are often just as difficult and expensive to defend as a clear-cut error. Insurance typically pays for the cost of defending this type of claim as if it were a clear-cut error on the part of the insured consultant.

Unlike other types of liability, damages from media related claims are hard to quantify - how do you determine the value of a marred reputation or a stolen idea? Awards can far exceed actual economical damage and often include exemplary damages that can destroy an organization, regardless of size.

Also unique to media liability are unusually high legal expenses: offended plaintiffs tend not to negotiate, prolonging litigation, and indignant defendants often claim their First Amendment right of free speech, refusing to settle based on principle.

Errors can vary dramatically depending upon the type of operation and the particular situation. Examples of claims can be found by clicking on Claim Examples.

Professional Liability Insurance

Professional liability insurance for media organizations, often called media liability and sometimes called errors and omissions or E&O insurance, is available from a small group of specialty lines insurers. Very few insurers write all types of media organizations. Often the best proposal for a typical media organization will come from a small specialty lines insurer.

Coverage and pricing varies greatly depending upon the type of professional operation, the specific services provided and its size, location. Specific coverage provisions are important for this coverage, and the specific coverage should be reviewed in detail with each account. Some professionals require coverage with special provisions to protect themselves from unique claims arising from their specialized services. For example, a magazine has significant libel/slander exposure, while a public relations consultant may have a financial exposure in addition to the libel/slander exposure.

Coverage is typically provided on either a basis. Availability of occurrence depends upon both the type of organization and market conditions. Limits and deductibles vary with the size and type of insured. Standard limits for most small to medium sized organizations start at $1.0 million. Policy forms vary significantly.

New technology and emerging media exposures - especially those arising from newsgathering - have mandated a change in the traditional media liability policy, and some policies have not kept up with the times.

Some new policies provide some of the following types of coverage:

"open" perils - the limited named peril policy can't keep up with creative plaintiff attorneys nor adequately respond to the ramblings of pro se litigants;
sole editorial discretion to the Insured in deciding whether to correct or retract media content;
for liability assumed under contract, which extends coverage to third parties, such as printers, distributors or advertisers, who utilize media content furnished by the Insured;
for breach of oral agreement or confidentiality arising from the failure to maintain the confidentiality of a source or materials furnished by a source;

Coverage can be provided for a wide variety of media-related firms, including:

Newspapers & Magazines
TV & Radio Stations
Advertising Agencies
Public Relations Consultants
Media Buying Agencies
Graphics Designers
Internet/Web Designers
Publishers & Printers
Direct Marketing Organizations
Marketing Consultants

Mercator Risk Services Inc. ("Mercator" or "Mercator Risk Services") provides coverage for a wide range of media organizations and professionals. Please let us know your client's needs and we will provide you with information and assistance with your particular situation or account, and professional liability coverage.

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