Do people get liability insurance for their website? If so, where?

[fretfull]

Do people worry about this? A website provides a public presence and thus possible liability. From possible copyright issues, to personal information to someone simply not liking what your site is saying. I've done some light research, like asking my insurance guy and random calls to insurance agents, and it seems that the moment I say website, they say they don't cover that. Does anyone have experience getting insurance? From whom?

[Elsmarc]

If you are not a business, I doubt you can get insurance. And home owners insurance won't cover anything business related. If you are a business you should have a business insurance policy. Your insurance company should at least have a rider you can purchase. Yes, it does happen, but probably very rarely. I was sued in federal court (civil lawsuit) in 2015 for a brief thread from 2001 in a forum on one of my technical websites which was about his bogus advertising claims. Long story on how the lawyer got that into the lawsuit (past the statute of limitations), but that was essentially what it was all about. The guy was (and still is) an asshat with a personal grudge. It took 5 months to settle out of court and in the end: 1. I actually made money*, 2. He declared bankruptcy soon afterwards, and 3. His reputation in the industry he was in was totally destroyed when word got out that he had sued me (See #2).

*I had to sue my insurance company for compensation for the time I spent defending myself because I did all my own legal work except for the mediation meeting because I needed a hard hitting contract expert for that meeting.

[fretfull]

Thanks for the response. I find it hard to find anyone willing to insure a website, even with business insurance. To sum up all the various conversations I have, many will only do it if you have a physical business and the website is an extension of that. Even so, they will not insure anything that has user generated content(a forum), e-commerce or offers any type of referral. For example if you post a review of something, they will not insure that site. They said that if you have a physical store and the website sells items as an extension of that, then that would be considered.

So basically, they will not insure most sites that people run which are forums and influencer sites. Business general liability really only covers physical things and nothing in the digital realm. What's one to do?

I've only been talking to the big well known insurance companies. Are they specialized ones for the internet?

[iamlost]

Insurance is extremely restrictive and the terms used are extremely specific so it is critical to understand what they mean in that context. It is surprising how frequently not what one expects.

The second critical - and difficult - concern is to locate a cyber/web competent qualified independent insurance agent. Together you need to work through all the different coverage needs - there is no single all inclusive all covered price - it is an à la carte process. And often you can't get everything required from one supplier.

The third critical is to acknowledge that it won't be cheap. And that even when a particular coverage is available it may not be economically viable.

There is a single corollary that follows from the above: the supplier will try to sell you what they have not what you need. That is why you need your own independent agent. On whom you should do due diligence. Insurance and used car sales are similar.

[fretfull]

I tried asking an independent business insurance agent last year. He said that I would be covered with a standard general liability policy. I doubted it so I called up the toll free number for the company he was going to sign me up with. They plainly said that a general liability policy would not cover anything online.

It's discouraging that it's so difficult. The internet has been around in it's current form for 20 years. Why hasn't some insurance company implemented a website where you can type in your URL for a insurance quote? As it is now, when a insurance company says they don't cover websites, they can't even refer me to anyone that will. Some will say that there must be specialized companies that do it but they don't know of any.

Some personal umbrella policies now do say they will protect you from libel claims if you post on websites. I guess that's something. But doesn't offer protection if you run your own website.

If anyone can suggest an insurance company or agent, I would greatly appreciate it.

[tangor]

What are you trying to insure/cover/protect against? (do not reveal your site name, merely the exposure)

Exposure is things like

Physical assets (your computer systems)
Malpractice (doing something that causes HARM to another)
Financial (money lending, banking, etc)

At best websites are merely copyright creations and a whole different set of laws covers that exposure.

[fretfull]

But websites are more than copyright creations. It's different than just a published magazine. You can't break into a magazine and steal people's personal information. You can with a website. And has been shown by the recent cases with Yahoo and Facebook, the people who run a website can most definitely be held to account.

Personally, I have tiny exposure. My biggest exposure is if someone hacks my website and does something malicious like use my site to spam out email. I have no personal information for anyone to steal. People that I have asked about my website don't think I have much if any exposure. Still, we are in a litigious society. Some of the law suits you hear about are ridiculous, yet they still happen. As you can see from my username I'm a worrier. I have heard about cases where people are sued for copyright violation when unknown to them their logo is too similar to someone else's. In cases like that, liability insurance did pay out.

It's like having insurance for everything else. People have home owner's insurance which covers it if someone trips and falls in their driveway and sues. Will it happen ever? For most people, no. But that doesn't mean people shouldn't have home owner's insurance. Since if it ever does and you don't have insurance, it will not be good.

[tangor]

Are you attempting to insure against your FAILURE to comply with US and EU privacy laws?

I doubt any insurance carrier will be interested in covering a personal failure due to negligence... (Note: malpractice is a bit different than this).

If you are in compliance with LAWS that tell you what you need to do with PII, you won't need "insurance".

[tangor]

Oh, forget the home owner liability scenario ... nobody steps into a physical location on websites ... those kind of suits are not possible.

[fretfull]

"I doubt any insurance carrier will be interested in covering a personal failure due to negligence... (Note: malpractice is a bit different than this). "

That's the whole point of errors and omission insurance. To cover issues like that.

As for the analogy to home owner liability. It's an analogy, you are taking it literally. A visitor to a website is analogous to a visitor to home. One is virtual, the other is physical. The same premise still applies.

[tangor]

It's an analogy, you are taking it literally.

So will every insurance agent you speak with. But apparently you know more than I do. :)

(Used to in full lines insurance for 10 years, though that was back in the dark ages, like 1985-1995).

Interesting that you suggest internet sites are "homes" (liability insurance wise), but I guess that's possible. After all, for many years they were known as "home pages".

(Note, Errors and Omissions is a different class of insurance tied to contracts and promises of performance)

I can see why agents contacted are a little confused or want nothing to do with it when asked. WHAT EXPOSURE are you trying to insure against? Are you selling a product that can INJURE a human? Is your content DANGEROUS? Is your hosting so insecure you NEED coverage? I am confused.

[fretfull]

An analogy is not a suggestion. It's an analogy. Which in my analogy was to relate to the physical world what a virtual situation would be like. Analogies aren't meant to be taken literally. You seem to. The agents I talk to don't. They even provide their own relating what would be common coverage for a physical business is not available for a virtual business. They do agree that insurance is still geared towards physical businesses and not internet based ones. There are no equivalent policies like general liability for websites. Many of the agents I spoke to said that their companies were planning them in the future. Just not yet.

Are you saying in your experience that only businesses that are doing something hazardous and produce faulty products need business liability insurance? That would be surprising since it's my understanding that it's just common sense to have general liability for any business. For an former insurance agent, is it your opinion that most people don't need insurance. A good driver shouldn't have to get car insurance? Someone in good health shouldn't get health insurance? That doesn't seem prudent. Isn't the whole point of insurance to mitigate unexpected risk?

As for why a website should have insurance. A post from someone in this thread pointed out one such case. Which is also one of the things that insurance companies categorically will not insure. Any website with user generated content, like a forum. Is a forum DANGEROUS? Is a forum something that can INJURE a human? Is a forum insecure? Generally not. So why do insurance companies categorically refuse to insure them then? If you ponder it for a moment, especially as someone that used to be in the insurance business, you'll know why.

[keyplyr]

Many sites post a Terms of Service (ToS) that defuses liability.

Not as protective as an insurance policy, but it is documentation in court against those who claim harm.

[fretfull]

I do the same. I'm surprised by how many sites don't even do that.

Many user forums and big media companies rely on the 1996 Telecom act as their shield. Which basically says that a company is only the media and each poster is responsible for what they post. Just like how you can't hold the phone company responsible for what people say on the phone. I'm not sure how much longer that will go on. There's been a lot of pressure of late to hold the giants more responsible for the user content they show. There hasn't been much court history on all these things. Which leads to why insurance companies are categorically unwilling to insure it.

Insurance just isn't about mitigating risk for it's customers, it's about mitigating risk for itself. They need to know what the likelihood of issues are and what the expected outcome will be. Then they can charge appropriate premiums to support expected claims and still make a profit. This all takes history, data, stats, probabilities and a stable environment. None of which describes the internet. There are decades of data about how often people fall in a shoe store, how often they sue, how often they win and what the payout will be. There's not much of that for online issues. There's not even a good handle of what the issues will be. So how can a insurance company insure an unknown? As one agent put it to me as to why they don't insure websites, "Anything can happen on the internet."

[lucy24]

The analogy that comes to my mind is malpractice insurance, where the coverage is essentially independent of actual wrongdoing on your part. Something bad happens as a direct consequence of suchandsuch action, but it doesn't necessarily mean that the person who performed the action did anything wrong. But that’s only available to select professional groups (doctors, veterinarians, lawyers ... can you sue your accountant for malpractice?).

[fretfull]

That's a very good analogy. The equivalent of malpractice insurance in tech is errors and omissions otherwise known as professional liability insurance. If you ever work as a contractor for a large company, they will require it. Unfortunately, unlike in medicine, it doesn't apply if you work for yourself. A doctor can get malpractice insurance for himself even if he runs his own practice. I specifically asked the various agents about E&O. They said it would only apply if I worked for someone else. In this specific case, if I ran a website for someone else I would be covered. If I ran it for myself I wouldn't.