MySpace, Facebook, Blogging, Emails, Texting … The Internet Exposure

Posted on July 22, 2009

What you “say” on the internet…

Some people put some awful stupid statements in writing. YES … All of that IS in “writing”. Libel … the things you write … are easier to prove against you than the foolish things that you say (slander).

People are suing …
People don’t think about these things … until they get sued … and even then … I bet they think that they are covered under their HO policy. Whoops … guess again!

Did you know …
In Hermitage Pennsylvania a high school co-principal is suing four former students for creating a “parody profile” on MySpace.com where this principal “admitted to” smoking pot, having sex with students and keeping a keg of beer behind his desk.

Oh, by the way … this is a FEDERAL lawsuit …
Could this happen to some of YOUR insured’s kids … to the parents of these kids for “negligent supervision????” And … if it does … and your insureds are sued … will their HO policy respond with defense and coverage?

And … in another part of the country … San Antonio, Texas …
An assistant high school principal filed suit against two former students AND their parents for alleged defamatory statements made on their MySpace.com web page. She is suing for “defamation, negligence and gross negligence” for the “lewd, defamatory and obscene comments, pictures and graphics.” She is also suffering because a multitude of miscreants who have viewed“her” page … and contacted her.

The allegation against the parents contains the following language as “allowing access to the Internet, unsupervised and without restraint poses an obvious risk and unreasonable danger that such children would utilize the Internet for illicit purposes.”

For those of you who think … “kids will be kids” … this is a tad different than writing nasty things on the bathroom stall doors.

Internet-related Defamation lawsuits increasing …
106 civil lawsuits against bloggers and others in social networks and online forums were reported in statistics by Citizen Media Law Project at the Berkman Center for Internet & Society at Harvard University. This is up from just 12 in 2003.

What will the unendorsed Homeowners policy do?
The ISO unendorsed homeowners policy covers Bodily Injury and Property Damage liability.

“Bodily injury” means bodily harm, sickness or disease, including required care, loss of services and death that results.

“Property damage” means physical injury to, destruction of, or loss of use of tangible property.

One’s reputation is not “tangible property.” One who suffers mental anguish and emotional trauma over items “written” on the Internet about them does not suffer “bodily injury” … at least not in Massachusetts.

So … if either the named insured or other resident relative writes a defamatory remark about someone else or deliberately writes incorrect information about someone else resulting in a lawsuit … what will the HO policy do?

NOT MUCH …

SECTION II – LIABILITY COVERAGES

A. Coverage E – Personal Liability
If a claim is made or a suit is brought against an “insured” for damages because of “bodily injury” or “property damage” caused by an “occurrence” to which this coverage applies, we will:

Pay up to our limit of liability for the damages for which an “insured” is legally liable. Damages include prejudgment interest awarded against an “insured”; and

Provide a defense at our expense by counsel of our choice, even if the suit is groundless, false or fraudulent. We may investigate and settle any claim or suit that we decide is appropriate. Our duty to settle or defend ends when our limit of liability for the”occurrence” has been exhausted by payment of a judgment or settlement.

If the suit or claim is not BI or PD … then the Section II coverage will NOT apply … and therefore there will be no payment of damages or defense coverage.

What if the insured is NOT “guilty”?
Well … I guess that’s great … but how does that get proven? If your insured is sued then there will be a court case. Who will pay for the lawyer? If they have a normal unendorsed HO policy … not the HO carrier!

In today’s world of suit-happy individuals the Internet just provides one more mechanism from which potential problems and lawsuits can arise. And now … so many people have Internet capabilities on their cell phones.

Is there a way to provide coverage for libel/slander situations?

Yup! Actually there are two potential ways.

HO 24 82 (04 02 edition) Personal Injury endorsement

SECTION II – LIABILITY COVERAGES

A. Coverage E – Personal Liability

The following is added to Coverage E – Personal Liability:

Personal Injury Coverage
If a claim is made or suit is brought against an “insured” for damages resulting from an
offense, defined under “personal injury”, to which this coverage applies, we will:
1. Pay up to our limit of liability for the damages for which an “insured” is legally liable. Damages include prejudgment interest awarded against an “insured”; and
2. Pay up to our limit of liability for the damages for which an “insured” is legally liable. Damages include prejudgment interest awarded against an “insured”; and
DEFINITIONS

The following definitions are added:

“Personal injury” means injury arising out of one or more of the following offenses, but only if the offense was committed during the policy period:
1. False arrest, detention or imprisonment;
2. Malicious prosecution;
3. The wrongful eviction from, wrongful entry into, or invasion of the right of private occupancy of a room, dwelling or premises that a person occupies, committed by or on behalf of its owner, landlord or lessor;
4. Oral or written publication of material that slanders or libels a person or organization or disparages a person’s or organization’s goods, products or services; or
5. Oral or written publication of material that violates a person’s right of privacy.
Personal Umbrella policy … might provide such coverage as a broadening applicable over the “deductible”/Self insured retention

In today’s world this is a very REAL exposure, and you SHOULD have this endorsement on your homeowners’ policy. It is inexpensive and one that I certainly want … and have … on MY policy.

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