Picture this: one of your clients is a ‘Seinfeld’ fan, so he posts a picture of Michael Richards on his website. No harm done, right? Wrong, according to Leib Dodell, underwriting manager for Chubb Executive Risk’s media liability program.
‘It’s what your clients are doing without thinking about’ that agents and brokers need to be most concerned about, Dodell said.
During the San Diego leg of a nationwide tour to promote Chubb Executive Risk’s new Safety’NetSM product, Dodell told a roomful of insurance professionals that the number of cases in the works right now concerning Internet liability is ‘unbelievable.’
Dodell quoted James Brelsford, Esq.: ‘The low barriers to entry have led to an explosion of websites on the Internet. This has, in turn, conferred the legal status of ‘publisher’ on literally thousands of people and organizations, most of whom have no concept of their resulting legal rights and responsibilities.’
There are many ways to unknowingly step on toes in Internet territory, but some of the main areas of exposure include: trademark infringement, copyright infringement, privacy, defamation and technology failures.
‘Because of the Wild West nature of the Internet, people don’t realize that posting something on their website is just like putting it in the newspaper,’ Dodell said.
And new exposures are popping up all the time. One of Dodell’s favorites is ‘typosquatting’—when someone purchases a domain name which is the misspelled version of a popular site name, with the hope of pulling traffic away from their competition to their own site.
Some areas are trickier than others. Dodell said that patent infringement is one area that some carriers don’t want to underwrite: ‘It’s too perilous and unclear, and there are so many patents pending—the whole Internet is a patent infringement.’
Healthcare sites create another underwriting challenge. ‘We get them by the boxload,’ Dodell said. ‘They go to med-mal, they say ‘go to media liability’—it goes back and forth, so we’ve teamed up to cover them.’
Safety’NetSM, which was designed by experienced Internet and First Amendment attorneys and underwriters, offers coverage for media exposures faced by companies operating in an online environment. It protects against any claim arising out of ‘Internet Activities,’ which Chubb defines as the dissemination or use of ‘matter’ (content) on the policyholder’s website, or the transaction of business over the site.
‘How in the world do we rate this stuff?’ Dodell asked. ‘It’s hard to develop a rating methodology for brand new coverage, but we’re doing it. The dot-coms (which get more than 50 percent of revenue from their site) get the long form; the brick-and-mortars get the short form.’ Applications are downloadable from www.chubb.com.
Change in the Internet arena is a constant element, even over the last year. ‘One year ago, we were convincing them that there really were exposures; now, it’s educating them on which product to buy,’ Dodell said. ‘It’s not just a dot-com issue; it goes across the business spectrum.’
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