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Posted on October 12, 2009 by James Cochran | Posted under Insurance
Professional Liability Insurance Requirement for Marketing Consultants
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If your client says youneed it, you know you have to get it to secure the work. The good newsis, in the majority of instances, getting the required marketingconsultant insurance coverage can be both affordable and healthy foryour business. In general, client companies want their marketingconsultants, researchers and media professionals to carry some or allof the following three types of coverage: General liability insurance Generalliability insurance covers injury to people or damage to property. Tomarketing consultants, insurance like this may seem unnecessary. Afterall, what’s the likelihood that someone leading a meeting or presentingslides will damage a client’s property or hurt someone? The factis, a lot of companies require any vendors who may come on-site – fromnetwork technicians to market researchers, media professionals andInternet marketing consultants – to prove that they have generalliability insurance. In most cases, the client’s risk managers drivethe mandate, seeking to reduce the company’s risk of financial lossesfrom lawsuits. Additionally, general liability insurance reducesmarketing consultants’ liability in the event of accidents at their ownoffices. If a client injures himself when he trips over the rug in youroffice’s entryway, your general liability insurance should cover anyrelated financial liability – and could save your business relationshipwith that client. Professional liability insurance Professionalliability insurance, also known as errors and omissions or E&Oinsurance, is like malpractice insurance for marketing consultants,protecting you in the event of errors and omissions made by you or youremployees. Clients require it for a good reason: People make mistakes. Yourclient’s greatest risk in bringing you in as a marketing consultant isthat any error or oversight on your part could spark a lawsuit orfinancial loss. Having this type of insurance can substantially reducemarketing consultants’ liability. Let’s say you develop anadvertising campaign that you’re sure will win your client newbusiness. Instead, some existing customers find the campaign offensive,sparking a backlash that results in lost business for your client. Yourclient can claim that you’re responsible for any resulting financiallosses and could sue you for compensation. Professionalliability insurance is a good idea for any marketing or mediaprofessional. Without it, your legal defense could be expensive enoughto sink your business. Sometimes, all it takes is a misunderstanding,and you can be hit with a lawsuit. After a client alleges that you werenegligent and communications begin to break down, your legal expensesrise exponentially. To get answers about the right amount ofcoverage for E&O, marketing consultants should seek out a reputableinsurance agency that can assess the business’ level of risk. Workers’ compensation insurance Workers’compensation insurance can be one of the more confusing types ofcoverage, largely because some states require it while others don’t. Ifyour client’s home office is located in a state that requires it, youcould be asked to carry it, even if it’s not a requirement in the statewhere you do business. Why do clients insist on workers’compensation insurance for marketing consultants? In some states, ifyou’re injured while under contract, your client must cover you withits own workers’ compensation policy. And, in some states, yourclient’s insurance carrier may require its customers to cover allcontractors that don’t show their own proof of coverage. In both cases,your clients’ premiums go up. In the event of on-the-jobinjuries, workers’ compensation insurance pays for medical expenses aswell as disability and compensation. If you’re a solo marketingconsultant or media professional, and you have your own healthinsurance policy, workers’ compensation insurance may be unnecessary –but your client may require it nonetheless. If your marketingconsultancy does have employees, protecting them with workers’compensation insurance is just a wise idea. Whether it’s repetitivestress injuries due to typing or a sprained ankle from a fall on aslick break room floor, even the smallest on-the-job hazards couldresult in injuries that could take your people off the job. Workers’compensation insurance gives you peace of mind that your employees aretaken care of, and saves your marketing consulting company the cost ofany ongoing medical care. About The Author: James Cochran is the founder of Business Insurance Now, a company committed to providing quality professional liability insurance to small businesses. Jim has been actively involved in the industry for over a decade and understands the value that general liability insurance has for consulting companies. |
Tags: PROFESSIONAL LIABILITY INSURANCE, GENERAL LIABILITY INSURANCE, INSURANCE FOR MARKETING CONSULTANTS, INSURANCE, PROFESSIONAL LIABILITY
