Social Media Management: New Challenges, insurance solutions exist

Facebook, Twitter and YouTube are giving life to new risks for individuals and businesses. The speed at which images and words can be cut, pasted and redistributed by anonymous sources magnifies the risks for any organization that relies on its reputation when transacting. Most people and companies using social media either don’t fully understand these risks or the potential liabilities. While there have been few legal cases yet, experts assert that it is only a matter of time before we witness multimillion-dollar court cases and insurance settlements.

Chubb Insurance, Fireman’s Fund Insurance Company and Travelers Insurance are leaders in underwriting policies for newspapers, broadcasters, movie makers and online media companies. Chubb, however, is now also recognizing the potential risks from social media participation and is investing resources to adapt its underwriting and protect client companies that are not in the business of media.

“We’re coming in and trying to wake people up,” said Ken Goldstein, Chubb’s worldwide media liability manager to The Star Ledger, New  Jersey’s leading daily newspaper. “Non-media companies now have the same exposures: defamation, invasion of privacy, copyright infringements, advertising infringement, allegations of false advertising and trade libel.”

Today, non-media companies represent as much as 15 percent of Chubb’s current book of media liability insurance. The carrier anticipates that this number will climb now that social media has turned almost everyone and their mother into a publisher.

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