Protect Your Business by Making Sure Your Marketing Partner Is Properly Insured

Published on March 5, 2024

At its best, insurance protects you from the unexpected.

That’s particularly important in business. As a leader, you need to think not only about material loss, but the irreplaceable value of your brand equity. Any loss event also has the potential to compromise the trust people place in you. Insurance equips you to limit the impact.

So, you’ve decided to go with a marketing agency as your outsourced marketing partner.

Do they have insurance?

Few companies consider this when choosing a marketing agency. Unfortunately, the majority of “marketing agencies” are solo entrepreneurs or small teams that are creative, but don’t have what it takes to operate a reliable business. Their collateral might sizzle, but their sloppiness can still cost you.

Any good marketing agency will provide a contract, not rely on you to wrangle an external law firm or provide one through your internal counsel. And that contract should be ironclad, not a template downloaded free on a stock website. If a contract is providing everything it should, it will:

  • Provide an appropriate amount of insurance; AND
  • Shield you from liability for their actions.

Why You Can’t Do Without a Contract from Your Marketing Agency

Sometimes, leaders in smaller businesses have difficulty asking for a contract. They feel like they’re just “imposing” on the vendor. But when you get to a higher level, you need to rethink the equation. Having contracts in place isn’t one-sided. It’s just good sense.

A contract protects your marketing partner just as much as it does you.

How so? Imagine things going off the rails. If there’s no contract, then your only recourse is to sue. No matter the details, you’ll have to go to court to be made whole. That’s a lot of time and expense that could be avoided just by spelling out boundaries and putting processes in place through a written contract.

Here’s an example: You part ways and a marketing agency retains control of your social media. There is no contract, so it becomes much harder to prove that wasn’t part of the agreement – after all, they might have posted everything on those social media accounts for months.

Another more common situation is this: You hire a marketing agency and they simply don’t do the work. Perhaps there’s a “good” excuse at first and you extend your timelines. But ultimately, it becomes all too obvious they have no intention of delivering. When a contract is signed on day one, it’s much easier to recuperate any losses—and just as important, to prevent those unnecessary losses from growing.

Contracts also defend your interests when everyone has the best of intentions, but things still don’t go as planned. A marketing agency partner could misplace a password, leaving you at risk of millions of dollars in losses. However, you might not have any way of making it right without a contract in place before the fact.

Before You Contract a Marketing Partner, Ask the Right Questions About Insurance and Liability

Even if a contract looks sound, ask tough questions about insurance before you sign.

At a minimum, anyone providing marketing services should have general liability insurance, even if they’re just a solo freelancer. Reputable businesses go a step further with professional liability insurance, also called E&O (Errors and Omissions). On top of that, they need to have appropriate endorsements on their insurance.

Although it may not come up as often with marketing agencies and other marketing partners, vendors doing specialty work such as IT or production should demonstrate they have the right endorsements for the job.

Finally, remember that their liability is your liability. You need to know what parts of their job are handled by a third party – and what kind of agreements your partner has with their vendors. If they aren’t willing to tell you, they aren’t just “protecting trade secrets.” They aren’t being serious – and you should move on.

Without that layer of assurance, their liability will quickly become yours.

How a Real Professional Marketing Agency Handles Liability

At New York Ave, we don’t play games when it comes to your liability or our own:

  • We have a legally binding contract with all clients
  • We have general liability insurance, professional liability (E&O) insurance, and endorsements for web hosting and media production
  • We have legally binding contracts with all employees and vendors

That’s the serious approach you should expect from true marketing professionals. And it’s what makes the difference when you’re looking for a business that can deliver on its promises.

Contact us to find out more or get started today.

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