The internet can make or break your small business.

Insurance Insights | July 23, 2018

The internet can make or break your small business.


We live in an era when social media and online chatter can make or break a business.

The potential for both growth and downfall are equally awe inspiring. Business owners must be present to the risks and take the appropriate precautions.

On the internet, anyone can say anything about you. Negative comments can attract an avalanche of attention that buries your business and wrecks your reputation.

How do I protect myself from these risks? Insurance can pick up some of the costs associated with damages arising from negative online comments. This would be part of the libel and slander coverage under commercial insurance.

That being said, it’s difficult to protect against this kind of risk. You must be able to demonstrate that a given online comment negatively impacted your company’s sales, reputation, etc. It’s crucial to quantify the impact: have you lost customers? Employees? Are sales down?

Beyond online comments, your business may be the subject of negative articles in the press. Now, this is not illegal. And of course, reporters and newspapers may treat your business fairly. You don’t sic your lawyers and insurance on every person who talks about your company.

And even if they do treat you unfairly, the onus is still on you to prove that you suffered a negative impact. Insurance companies will need to see your records for evidence of impact. They will investigate a bit and you have to decide if you’re comfortable with this.

If you do demonstrate this impact, commercial insurance has the possibility of covering legal defence costs (lawyer fees). Other areas of coverage include a payout to cover court imposed penalties.

Finally, don’t forget that policies have exclusions. Always check with your broker to make sure you’re covered for whichever claim you’re considering filing.

Contact us today to ensure your business is protected from the whims of the internet.