What are the most common risks faced by creatives?
At a high level, most businesses face similar risks, but the severity of these risks will vary widely. An advertising creative is more likely to find themselves accused of copyright infringement, for example, while a photographer or videographer (with all the equipment and chaos that comes when doing a shoot) is more likely to face a public liability claim.
Below, we’ve listed some of the most common risks that creative freelancers face.
Intellectual property infringement
This can arise if you use third-party materials such as images and music in content without having the appropriate permissions to do so. For example, let’s say your company produced a piece of marketing collateral for a client using a photo that was sourced through google images by an intern. The ownership was overlooked and no one obtained the appropriate permissions to use the photo. Your client could be sued and, more often than not, this would result in your client taking legal action against you.
This is the act of damaging an individual or company’s reputation through the use of libel or slander. As many companies now use social media and blogging sites to promote their business online, they are also at risk of receiving a claim of defamation. While some claimants use defamation law to constrain legitimate reporting and criticism, in other cases you may unintentionally defame someone.
Refusal of payment
What if a client refuses to pay your fees due to a complaint about your service, dissatisfaction with your work or simply to avoid their contractual agreement by claiming negligence? Whether you did anything wrong or not this leaves you in a difficult situation, in need of legal support and potentially out of pocket as a result.
Big little mistakes
Small but deadly. Spelling mistakes, inaccurate pricing, typography/layout errors, or omission of vital information are little things that could cause massive damage to your reputation. This is an issue that we see frequently with our media and marketing clients but fortunately it can be recoverable if acted upon quickly. Professional indemnity insurance can help cover the costs of reprinting any materials and if the error isn’t spotted in time, it can also cover any loss caused to your client as a result of the error.
What insurance do creative freelancers need?
Now for the good news – for every risk listed above, there’s the cover to help ameliorate the consequences of that risk.
Professional indemnity insurance
It’s your job to come up with big, new and sometimes controversial ideas. But what if they don’t work out and your client doesn’t get the results they expected? Worst case scenario, you could face a legal claim and compensation, which is where professional indemnity insurance (PI), also known as errors and omissions insurance, comes in. Designed for any business offering a professional service or advice, professional indemnity insurance will protect you if:
You make a mistake, or if a client suffers – or claims to suffer – a financial loss as a result of your work. If this happens, professional indemnity insurance will cover your legal expenses and compensation costs.
You infringe industry regulations. For example, if your work includes television commercials, the contractual obligations of the commercial producer are defined by the APA/IPA Production insurance briefing schedule (PIBS) – failure to meet these obligations could result in significant costs and penalties. In situations like this, professional indemnity will cover your defence costs and resulting fines, many of which are insurable.
You become involved in an intellectual property dispute – whether protecting your own intellectual property, or defending an infringement of somebody else’s. That could be using images or music without permission, or infringing on another company’s branding or logo.
Finally, you may also find that clients insist you have professional indemnity cover – so it could even help you win business (or not lose it!)
Media liability insurance
Similarly to professional indemnity insurance, media liability insurance is designed for the unique needs of media and advertising businesses, protecting you from infringement of intellectual property, breach of confidentiality or right to privacy, breach of comparative advertising regulations, slander or making false or misleading claims. So, if you’re faced with a #fail on social media, a client’s website, or another online or offline channel, any legal claims and compensation may be saved by this particular cover.
Public liability insurance
Public liability insurance is another basic requirement, protecting your business if you or one of your team causes injury or property damage to a third party. For an advertising agency, you could be at risk while out shooting your latest video or TV ad, implementing a quirky stunt or simply visiting your clients’ offices, or attending industry events. Even if you’re mainly home-based, public liability insurance may be relevant to you as you may find yourself working elsewhere from time-to-time, or working clients at your home office.
Business contents insurance
Your valuable equipment also needs protecting, whether that’s a simple laptop, camera, or filming equipment. Business contents insurance covers everything in the office, including your fit-out, computers, office equipment, furniture and documents. You should also consider portable equipment insurance, which covers everything you and staff take out and about with you, such as laptops, mobiles, cameras and tablets.
Advertising is a competitive and innovative industry, it’s exciting, but the flip side is that there are plenty of constantly developing risks to consider. Ensuring that you regularly review your risks and your business insurance
Still not sure what cover you need? Check out Superscript’s guide to the different types of business insurance which includes questions to ask yourself when considering each cover.