Social Media Risks for Business: What You Need to Know

Social Media: A Modern Business Liability Risk

The stories of social media fails are legendary — companies using inappropriate humor around serious social issues, typographical errors, or pop culture references that backfire in public.

These examples represent reputational issues that can directly affect your company’s brand and its sales.

But the headline-making social media marketing mistakes can obscure other, less visible social media risks for businesses — including privacy violations, security breaches, unauthorized use of intellectual property, and employment-based claims, among others.

What Are the Liability Risks of Social Media for Businesses?

The risks that social media introduces to your business generally aren’t new risks. They’re conventional business risks — reputational, legal, and operational — delivered through a newer, faster-moving channel.

Common social media liability risks for companies include:

• Reputational damage from poorly judged posts or public backlash
• Privacy violations involving customer or employee information
• Security breaches tied to compromised business accounts
• Unauthorized use of intellectual property, such as images or content
• Employment-based claims arising from employee social media activity

How to Manage Social Media Business Risks

To help manage the risks that come with your company’s social media use, consider the following steps:

• Create a social media policy for your company. Develop separate policies — one for employees using social media as part of their job, and another for employees using social media in their personal lives.
• Don’t create your policy in a vacuum. Draw on the diverse talents and perspectives of your employees when developing it.
• Limit social media posting to designated spokespersons for better control over your company’s messaging.
• Train all employees on your social media policy so expectations are clear across the organization.

Does Business Insurance Cover Social Media Risks?

These risks may already be covered by your existing business liability insurance, available through a rider added to your current policy, or obtainable through specialized coverage designed specifically for social media liability.

The right option depends on your business’s size, industry, and how actively your company uses social media. Speak with your insurance agent — whether your business is based in Fort Myers, Naples, Cape Coral, or elsewhere in Southwest Florida — to make sure you’re adequately protected against the business risks of social media.