What Is Personal and Advertising Injury? The Answers You Need to Know

Your small business is more than just your job. It’s your livelihood. And one of the best ways to help it grow is word-of-mouth referrals. Whether it’s customers making recommendations to their friends or your employees stewarding your brand, getting your business’s name out there can help attract new customers.

However, not all exposure is good exposure. When trying to sing the praises of your own company, it may appear to others to be at the expense of a competitor. This is where personal and advertising injury coverage comes in.

In this article, we’ll explore what small business owners need to know about personal and advertising injury, including what it is, how to avoid it, and steps to consider if you’re accused of it.

But First: A Personal and Advertising Injury Definition

Personal and advertising injury coverage is a component of general liability insurance. Since 1998, personal injury and advertising injury have been combined into what is known as Coverage B. Let’s break general liability Coverage B down into its respective parts.

What is considered personal injury?

According to the International Risk Management Institute, personal injury would include the following:

• False arrest or imprisonment. An example: a person has been detained unlawfully.
• Wrongful eviction.
• Malicious prosecution.
• Slander, which is generally a false, defamatory statement made verbally.
• Libel, which is a form of defamation that is written.
• Invasion of privacy

Advertising injury definition

Advertising injury specifically deals with injuries in the form of — you guessed it — advertising. The International Risk Management Institute states that advertising injuries would include the following in advertisements:

• Libel and slander.
• Invasion of privacy.
• Copyright infringement. This could include adopting a name that already belongs to or is considered too similar to another business.
• Misappropriation of advertising ideas.

Personal Advertising Injury Coverage

Given how specific it is, personal and advertising injury coverage may seem a bit niche. But it can help protect you and your business in a number of ways. If, for instance, your business misrepresents another business, causing it potential financial losses, personal and advertising injury coverage may help financially protect your business (up to your policy limits).

Coverage B is there in the event your business is obligated to pay damages for libel, slander, and other personal and advertising injuries, for example. The coverage may also pay for legal expenses relating to a personal and advertising injury lawsuit.

Examples of personal injury

One scenario that could potentially lead to a personal injury is if a shop owner falsely believes that a customer has shoplifted. If you or another employee detains the shopper in question to wait for authorities and it turns out your suspicions were unfounded, that would likely be considered false detainment. You could be liable for damages if the shopper takes legal action.

Another example is the real-life case of Dun & Bradstreet, Inc. v. Greenmoss Builders, Inc. In this case, Dun & Bradstreet erroneously reported that Greenmoss Builders had filed for bankruptcy. This error was potentially damaging to Greenmoss Builders’ business.

Advertising injury example

For a real-world example of advertising injury — specifically, copyright infringement — look at the case of Rogers v. Koons. In this case, photographer Art Rogers took and sold a photograph of a couple holding puppies. Artist Jeff Koons used the image as the inspiration for a statue for an art exhibit. The court ruled that the photograph and statue were, indeed, similar enough to qualify as copyright infringement.

Another example can be found in Vitamin Energy, LLC v. Evanston Insurance Company. Vitamin Energy was sued by a competing energy drink brand for false and misleading advertising. When Evanston Insurance, Vitamin Energy’s commercial general liability insurance carrier, refused to cover the company, Vitamin Energy appealed that the original claim fell under the umbrella of advertising injury. The court ultimately agreed, and Evanston Insurance was directed to cover the related costs.

What Isn’t Included in Personal and Advertising Injury Coverage?

General liability Coverage B may cover a wide variety of personal and advertising injury claims, but it does have limitations. The following are common exceptions that are not covered — or may not be fully covered — under Coverage B.

Intentional acts of harm

Your general liability insurance carrier will not provide coverage if the harm was intentional on your part. This could include purposely slandering a competitor or printing information about them that you know to be false.

Bodily injury and property damage

Any claims of property damage or bodily harm would likely fall under Coverage A of general liability policies and are not considered personal or advertising injuries. If an employee experiences bodily injury or illness, it may fall under a general liability policy, but not as personal and advertising injury.

Some expenses may not be covered if coverage limit is exceeded

Your personal and advertising injury coverage may not fully cover the total expenses from your claim. Your policy will have monetary limits, and a more serious claim may exceed those limits.

Incidents occurring before the policy term

If the personal or advertising injury precedes the inception of the general liability insurance policy, the insurance carrier will not cover the expenses.

Criminal acts

If the insured’s offense includes criminal behavior, the expenses will likely not be covered under Coverage B.

Contractual liability

Any liability that has been previously assumed by the insured through a contract or official agreement will likely not be covered. The parameters of this exception, however, can get tricky. More details can be found here.

How to Get Personal and Advertising Injury Insurance

Every business owner knows: anything can happen. Running a small business can be complicated and unpredictable. You can’t prepare for accidents, and communication issues can lead to greater problems down the line.

That’s where we come in. While not every policy will include personal and advertising injury coverage, general liability insurance can help keep your business financially safe and — when the unpredictable happens — prevent you from being required to foot the bill. Simply Business partners with small business owners to find coverage that works for them. Start your general liability insurance quote online today.

The Golden Rule

Navigating the murky waters between healthy competition in advertising and libel can be tricky. Owners of small businesses know the importance of promoting their goods and services. It’s easy, however, to find yourself in risky situations where the line between what is fair and factual and what is exaggerated or inaccurate can become unclear.

When in doubt, take a step back and ask if what you’re saying or doing is based on verifiable facts or if it’s speculation. Consider the situation from all perspectives. It doesn’t hurt to think about how you would respond if someone said the same thing about you. But if you do find yourself in a difficult spot due to a personal or advertising injury, Coverage B has you covered.