Why do marketing agencies need insurance?
Marketing agencies manage and recommend marketing approaches to their clients to get their products and services in front of customers. Sometimes, however, the best-laid marketing plans don’t go according to plan.
Claims that your work did harm
Occasionally, marketing campaigns can have the opposite effect or fall flat. Your advice can damage brands in those situations, and you're likely to receive demands of financial compensation from the clients you once advised.
Accusation of causing a financial loss
An unhappy client might allege your advice, actions, or recommendations led to significant financial loss that they now want to recover from you.
Breach of confidentiality
If your client shares commercially sensitive information with you and you accidentally misplace it or share it with an unauthorised third party, your client may demand a financial remedy.
Unforeseen accidents leading to an injury
Clients coming to your office or meeting with third parties face-to-face can sometimes lead to accidents to people or property that you can be held accountable for.
Professional indemnity insurance for marketing agencies
Professional indemnity insurance is a critical cover that protects marketing agencies from accusations of professional mistakes, negligence, copyright infringement and other claims against you or your business.
Given the potential exposures marketing agents can face, professional indemnity insurance can be very affordable compared to the possible costs if you need to defend yourself.
What does marketing agency professional indemnity insurance cover?
Professional indemnity insurance protects marketing agencies from claims or accusations of wrongdoing from their professional advice or work product.
Cover includes:
- Failing your duty of care
- Making a mistake
- Acting negligently
- Giving the wrong advice or recommendation
For example you may be facing financial demands from a client because:
- You designed an ad campaign that caused offensive and public brand damage.
- Your management of client ad spending went wrong, wasting large amounts of your client’s money.
- Your inability to finish your work on time resulted in a client missing a critical advertising window, and their stock went to waste.
What professional indemnity limit do marketing agencies need?
The professional indemnity limit you need will reflect your particular business activities. When choosing a limit, consider several factors, including the value of your client contracts, your contractual requirements, and possible financial impacts if your campaigns go wrong.
Does professional indemnity insurance cover my marketing activities worldwide?
Your professional indemnity policy's ‘territory or geographical limits’ and ‘jurisdiction’ sections specify if your marketing agency insurance will respond when working in different countries.
Territory or geographical limits:
The territory or geographical limit specifies where you can virtually or physically deliver your services. For example: “Worldwide.”
Jurisdictional limit:
The jurisdictional limit specifies which legal jurisdictions your policy will defend you if you are sued. For example: “Worldwide excluding US and Canada.”
Contract governance:
Any contracts or agreements you enter into with your clients should specify the ‘governing law’ for that contract, which is the jurisdiction in which parties can seek legal remedy for breach of contract.
Avoid entering contracts not governed by your local jurisdiction and/or excluded by your marketing agency professional indemnity insurance.
If you work with US and Canadian clients, you can reduce your risk by not entering contracts governed by US and Canadian laws.
Switching your professional indemnity insurance
Typically, in the UK, if you cancel a professional indemnity policy, you can no longer claim against it.
Therefore, if you switch your marketing agency insurance provider, be sure your new policy covers your past work; this is called “retroactive cover”.
Should I keep professional indemnity insurance if I close my marketing agency?
It’s wise to keep your professional indemnity if you’re taking a break or retiring from marketing. Claims against professional misconduct can surface months or years after you delivered the work.
Remember: If you cancel your policy, your insurance coverage will end, including coverage for any previous work.
How long you keep your cover in place is up to you. Consider the type of marketing you did and the likelihood that a client might bring a claim against you.
Public liability insurance for marketing agencies
Public liability insurance shields marketing agencies from claims of injuries or property damage.
If you have any kind of face-to-face contact with your clients and the public during your business, then there is a risk of third-party injury or property damage. Something as small as spilling your flat white over a client’s laptop can set you back a few thousand pounds.
Public liability is an inexpensive protection against unfortunate incidents such as slips, falls, or you causing damage to a third party’s computer equipment.
What does marketing agency public liability insurance cover?
Public liability insurance is valuable when faced with injury claims and compensation demands.
Cover includes:
- accidental injury or death
- accidental property damage
For example:
- A client visits your premises and is injured in a slip or fall
- You visit a client site and damage equipment by knocking over a coffee
- During a marketing campaign that you manage, a member of the public gets injured
Other insurance marketing agencies buy
As a marketing agent, you may need extra insurance, based on your individual situation. Consider your ability to handle legal disputes, reliance on expensive equipment, ability to manage expenses if you become ill, and whether you have employees. This can help determine if additional coverage is necessary.
Commercial legal expenses insurance
Most commercial legal expenses insurance will protect marketing agencies against various tax and legal issues you may encounter due to your profession, which are not covered by professional indemnity or public liability.
At Suited, we combined £100,000 of commercial legal expenses insurance with helplines and other tools to better assist marketing agencies in dealing with these issues. We call this Business Legal Protect, and it’s part of your subscription.
Business Legal Protect offers qualified advice and assistance with:
- Legal and accountancy matters concerning your business
- Criminal prosecution
- Compliance & regulation issues
- Help with unpaid invoices (over £200)
For example:
- HMRC investigations into your tax affairs
- You need legal help chasing a client who has not paid a significant invoice.
- You wish to take a business partner or client to court over a breach of contract.
- You required guidance on compliance or regulatory issues for your business.
Electronic business equipment insurance
Marketing agencies rely on electronic equipment to deliver their services more than ever. If your business depends on electronic equipment, consider electronic business equipment insurance.
Employers’ liability insurance
If you have anyone working in your marketing agency either full-time, part-time, contractors or volunteers, employer’s liability insurance is required by law.
Marketing agencies we insure
Suited offers insurance coverage for a wide range of marketing agencies, including:
- Advertising agencies
- Creative agencies
- Digital media buying agencies
- Market research agencies
- Marketing agencies
- PR agencies
- Promotional agencies
- Sales promotion agencies
- Social media agencies
- Telemarketing agencies
- and more..
Shopping for marketing agency liability insurance
Whether or not you decide to use Suited marketing agency insurance to protect your business, it’s worth keeping the following in mind:
Cheap marketing agency insurance
At Suited, we understand that choosing a marketing agency insurance provider involves more than just cost. We offer multiple communication channels for seamless contact with our team and pride ourselves on our prompt response time to ensure customer satisfaction.
The reputation of the insurer is important
Insurance needs to be there when you need it most. The payout reputation of an insurer is essential. Suited uses financially sound insurers with an A+ rating.
Many providers charge fees to amend or cancel
Low initial prices often hide additional charges to pay monthly, amend or cancel your policy. At Suited, we charge no extra fees, and you can cancel anytime with no more to pay.
Some policy wordings are restrictive or have a high excess
Some providers will offer attractive prices, but it is at the expense of cover given. Suited professional indemnity and public liability have £0 excess.
