Do You Have the Right Insurance for Your Content Business?

Mistakes – even unintentional ones – happen. You publish something without realizing a portion was copyrighted or fail to fact-check a piece of information correctly. A guest on your live podcast makes a slanderous remark.

Accidents happen, too, even with the most thorough planning. A cyber thief accesses your database, gaining all that personal information you retain. 

But you can (and should) do something now to mitigate the potential financial impact on you and your business. It’s also good to have insurance to comply with client and partner requirements and to indicate your business is not a hobby or fly-by-the-seat-of-its-pants operation.

MFE Insurance Brokerage outlines three types of insurance required for podcasters, but they can apply to content entrepreneurs regardless of content products – errors and omissions, general liability, and cyber liability.

General liability insurance

All businesses should have general liability insurance (and it’s the type most often required in third-party contracts.) And it’s valuable even if you don’t have a physical space where someone could get hurt, or property could be damaged. It covers “advertising injury,” too. 

“So you’re covered if someone sues you for … making false claims or posting their content without permission,” according to Practice’s insurance guide for writers.

Errors and omissions insurance

Also known as professional liability insurance, it can apply to content products, where a mistake causes a customer to lose money, or consulting services, where clients blame your advice for a loss.

As MFE explains, E&O insurance covers transgressions such as plagiarism, accidentally slanderous remarks, trademark or copyright infringement, and misappropriation of personal details about your guests or sources. 

In addition to paying valid claims, according to Chubb Insurance, E&O insurance can help with legal expenses required to deal with any claim (even frivolous ones).

Cyber business insurance

Although it is a relative newcomer to the insurance category, every content entrepreneur should consider it, given how closely tied their business is to digital data and publishing.

In its cyber liability guide, JP Morgan Chase explains that this type of policy supports entrepreneurs who experience a cyberattack that results in data loss or a breach of confidential information.

Its coverage includes recovery costs for revenue losses from the business interruption, restoration of personal identities of impacted audience members, communication to stakeholders, and civil fines and penalties. 

Cyber insurance also can be valuable if you’re a victim of cyber extortion. I know of one author who had his book draft file stolen and received a digital ransom note demanding payment to return the file. (He didn’t do it, but the incident also works as a reminder to save your files on an external hard drive.)

Understanding the policy numbers

You can acquire insurance in several ways – going directly to the insurance company, working with an agent or broker, or using the insurance benefits program from a professional group or association you belong to.

But no matter which route you take, you’ll have to make some decisions, including the policy limits, the deductible, and the premium. 

With general liability, E&O, and cyber insurance, you likely will have two limits – claim and aggregate. The claim limit is the maximum amount paid for a single claim. The aggregate limit is the total amount your policy covers for all claims in a specified period (usually a year.)

The deductible is the amount your business will pay before the insurance pays. And the premium is the amount you pay to hold a valid insurance policy. 

Not surprisingly, all three components are tied together. So, if you have opt for a higher policy limit, you’ll have a higher premium. If you pick a higher deductible, you’ll have a lower premium. 

Of course, the size, scope, and location of your business also affect premium rates. In general, small businesses can expect to pay $30 to $60 a month for general liability, $50 to $100 a month for E&O, and over $140 a month for cyber, according to multiple insurance sites. 

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Planning your business insurance application

You should schedule time on your calendar to complete the insurance application(s). It isn’t as simple as buying auto or home insurance.

Insureon shares what a typical E&O policy application requires: the date the business started, a brief description of its activities and the type of work it executes, and the legal entity (sole proprietor, LLC, S corporation, etc.).

Having recent balance sheets and a year’s projections, contracts used with your largest clients, existing insurance policies, executive compensation details, and an ownership interest in other companies would be useful. Claims history is often a requirement, too. 

The application for general liability insurance requires information similar to the E&O policy. Cyber insurance has more layers because the insurance company wants to know the steps you’ve taken to protect your data. Security provider StrongDM highlights five cyber-specific areas that an insurance application would likely ask about: access controls, vulnerability assessments, an incident response plan, multi-factor authentication, encryption, and training.

Now is the time to begin evaluating your options, budgeting for the expense, and gathering the required information. Though you hope you never need it, you must plan to get insurance. It will give you, as the owner, better peace of mind that your business is protected, and it will show your audience, customers, and the companies you work with that you really do mean business.

You can also prepare your business for the future by attending CEX this August and learning more best practices for your content entrepreneurial endeavor.

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