Traditional and print advertising are on their way out. Digital marketing is in. Clients will pay specialists the big bucks to make sure that they’re getting plenty of impressions, engagements and conversions online. But there’s a lot that goes into founding and running a sustainable digital marketing agency behind the scenes.
It sounds simple enough; if you have internet, computers and knowledge about digital marketing, aren’t you ready to take on clients? Not quite. You still need business insurance for digital marketing to ensure that you can handle a major (read: costly) event, like an accident or a conflict with a client.
Here are three reasons that digital marketing agencies need business insurance.
Your salesperson knocks over a client’s computer
You will likely host clients in your commercial space as well as visit theirs. Let’s say that you’re pitching to a potential client at their headquarters. Everything is going well until your sales rep’s briefcase catches on the corner of your client’s brand-new iMac. You can practically hear the “ka-ching” noise of your company owing money as it hits the corner of the desk and cracks.
For a small agency, a sudden expenditure of a few thousand dollars—or even a few hundred dollars—can be a real setback. And this is just one small example of how your employees, premises or operations could cause property damage or injury to other parties. For bodily injury, personal injury and property damage, you can rely on commercial general liability insurance to shoulder the expense—legal fees, medical bills or equipment replacement costs.
A client sues, alleging your advice cost them money
Digital marketing agencies are in the business of providing advice and services to clients. Your job often involves running their campaigns, not to mention providing recommendations on how they can improve their web presence. While you do your best, you can’t make any guarantees.
But clients can and have sued digital marketing agencies. For example, a few years ago, a law firm called Seikaly & Stewart sued its SEO agency, alleging that it had paid $49,000 to Rainmaker Institute for what amounted to “black hat” SEO tactics that violated Google’s search engine guidelines. The plaintiffs filed a lawsuit for their money back plus punitive damages.
That’s just one example of how a client relationship can go wrong. Are you prepared to defend yourself in court and possibly pay punitive damages if your counsel leads to financial loss for a client? Professional liability insurance (also known as errors and omissions insurance) covers negligence and inaccurate advice relating to your digital marketing services.
An electrical surge takes out your computer system
It’s raining, it’s pouring… your motherboard is snoring? When you arrive the morning after a huge thunderstorm, you find that your electronics have gone haywire. It seems that the electrical surge has knocked your equipment out of commission. To recoup your losses (possibly replacing equipment) and also keep your lights on while you assess the damage, you’ll want a Business Owners Policy (BOP) including property insurance and business interruption coverage.
That’s just the tip of the iceberg on business insurance for digital marketing agencies. To learn more, explore CoverHound and even get a personalized quote.