Liability: how to limit yours / Part III: Professional liability insurance: not cheap, not bullet-proof

The information in this article cannot take the place of personalized legal advice from your own lawyer. NASW accepts no responsibility for decisions made by any person on the basis of the content of this article.

It may help to have media or professional liability insurance (sometimes referred to as errors and omissions insurance) for cases involving libel, copyright infringement, etc. These types of policies sometimes also offer help with defense costs, loss of income, and the pain and suffering that come during a trial. There are relatively few options out there for freelance writers, but here is what I have found.

The American Society of Journalists and Authors (ASJA) does not offer liability insurance to their members. According to Alexandra Owens, ASJA executive director, "ASJA has not been able to find a policy of this kind worth presenting to our members. We most recently tried with a Media Perils plan, but the quote we got was upwards of $2,500 per year per person, and that was just out of reach."

The National Federation of Press Women (NFPW) offers a fairly affordable media liability policy. You must be an NFPW member ($74/year and, yes, open to both sexes) and the program costs $465/year. It is offered through Walterry Insurance Brokers.

It provides:

  • A dedicated policy limit of $300,000 per claim and $500,000 aggregate, which includes coverage for defense costs as well as settlements and judgments.
  • Comprehensive coverage for all claims arising out of the gathering and communicating of information, including (but not limited to) libel, slander, invasion of privacy, and copyright infringement. This is significantly broader coverage than other media liability policies on the market.
  • Coverage for the legal costs incurred in challenging subpoenas seeking confidential newsgathering information. This additional coverage will give you the financial wherewithal to resist intrusions into the confidentiality of the newsgathering process.
  • Punitive damages coverage to the extent permitted by law.
  • Confidential sources are fully protected. The policy allows you to protect the identity of confidential sources, even if this compromises the ability to defend a claim.
  • Worldwide coverage. The policy provides coverage for press activities engaged in by you, and claims asserted against you, anywhere in the world.

The website also identifies other important conditions, including that the insurance company has "the right and the duty to select the counsel that will defend you," and that the policy covers you, not a third party (such as a publisher) who is sued based on something you did or didn't do, even if you signed a contract with an indemnification clause.

Thus, you may still be responsible to the publisher or broadcaster under the indemnity/warranty clause in your contract. So it would appear that there is no good way to save yourself if you have signed the usual indemnity clause in a contract.

Another alternative is to take out a personal, professional liability stand-alone policy, which may cost $2,500 to $3,000 a year for basic coverage. Another route would be to check on getting a small business liability rider on your homeowner's policy — some companies offer this option.

The major disadvantage to an insurance policy is that there are typically many, many fine details in a very long, complicated policy, all designed to exclude your case. For example, many of these policies have an "occurrence reporting" rule, which means that you must report anything that leads you to believe there might be a claim in the future, within a specified time (sometimes as short as 10 days). If you fail to do so, the policy doesn't apply! Attorney Anthony Elia warns that if you purchase such a policy, you should ask for the complete policy to be sent to you (all 50 or so pages!) and read through it.

If you are writing pieces that are investigative, sensitive (financially or otherwise), or otherwise involve high-profile sources or celebrities, you may want to look into paying $3,000 a year for protection. Or, Elia notes, you could just put that money into your own "legal defense fund" account.

I called Walterry to see about the likelihood of NASW offering this type of policy directly (i.e., how many members would have to be interested) or if it is more feasible for our members to just become NFPW members. As per Steve Thomas of Walterry Insurance, NASW would have to make the policy mandatory for all of its members to make it work financially for Walterry. Obviously, that's not something that would be favorable. So he suggests our members go through the NFPW if they are interested.

My thanks to Anthony Elia for his time and help in creating this article. He can be reached at:

The Law Office of Anthony N. Elia, P.C.
185 Prospect Park SW, #607
Brooklyn, New York 11218
ph: (718) 854-2361
fax: (718) 854-1025
www.anelaw.com

Kendall Powell is a freelance science writer who writes for Nature, the Los Angeles Times, and Howard Hughes Medical Institute, among others. She lives in Lafayette, Colorado, with her husband, daughter, and two Labradors. She can be reached at Kendall2@nasw.org.