Personal and Advertising Injury coverage is contained within most General Liability insurance contracts. The main question I receive usually is about the advertising component of coverage.
The typical General Liability limit format looks something like:
| Occurrence Limit | $1,000,000 |
| Personal & Advertising Limit | $1,000,000 |
| General Aggregate Limit | $2,000,000 |
| Products & Completed Operations Aggregate | $2,000,000 |
Definitions: Personal and Advertising Injury Liability
Personal & Advertising Injury coverage starts with a definition. By the way, products coverage also starts with a definition and a topic for another day. Definitions play a key role and should not be overlooked. Insurance policies try to make definitions standout throughout the contract. Some use quotes around “words or phrases”, others may use a bold font but whatever the method, look for the term or phrase in the definition section.
Definitions should offer clarity but unfortunately insurance terms can contain definitions within definitions.
The Personal and Advertising Injury definition contains seven “offences” of which two have some meaning to specialty food and beverage companies:
- Use of another’s advertising idea in your advertisement or
- Infringing on another’s copyright, trade dress or slogan in your advertisement
Advertisement is then defined as notice broadcast to the public or market segments for the purpose of attracting customers or supporters.
Although advertisement is a broad term note that unless infringement occurs via an advertisement, coverage will likely not apply. The definition is the first hurdle.
Exclusions
Exclusions further refine coverage and the standard general liability policy contains 16 exclusions (A thru P) for Personal and Advertising injury liability coverage. Consequently, I will only highlight a few with the fourth being the one I refer to the most.
- Material Published with Knowledge of Falsity
- Contractual Liability
- Breach of Contract
- Quality or Performance of Goods – Failure to Conform to Statements
- Wrong Description of Prices
- Infringement of Copyright, Patent, Trademark or Trade Secret
- Electronic Chatrooms or Bulletin Boards (this is still the real wording)
- Unauthorized Use of Another’s Name or Product
Infringement
Infringement issues happen but coverage is very limited. As you can see, the term shows up in two places, definition section and as an exclusion. Notice the definition addresses infringement of copyright, trade dress or slogan used in an advertisement.
However, the exclusion refines the coverage further to be clear no coverage applies to infringement of a patent, trademark, trade secrets or other intellectual property rights.
Get Some Help
When something happens the insurance policy suddenly becomes a very important document but so often goes unattended for long periods. This article would be too long and boring (perhaps more boring) to get into greater detail so if you have questions, please let me know.
Solid legal advice is a must in this area to protect your food or beverage product information and to be sure you are not treading on others.