Tailify, Lloyd’s Coverholders, and Assured Social are working together to provide professional indemnity insurance to social media influencers, and increased advertising regulation will come into play as social media popularity continues to increase.
According to Statista, the global Instagram influencer marketing industry was worth $1.3bn in 2018 and is expected to almost double by 2020. This channel is relatively new, meaning that there is a lack of regulation when it comes to advertising. However, we have recently seen a move towards regulating content that may be harmful to consumers.
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In October 2019, the Advertising Standards Authority (ASA) banned Instagram advertisements by three UK reality TV stars that have a combined 3.1 million followers. The advertisements, which featured dieting products, were banned on the grounds that the posts were irresponsible. Following ASA’s July 2019 ruling that anyone with more than 30,000 social media followers is considered a celebrity and subject to advertising rules, more influencers will come under scrutiny over the advertisements they post.
While increased scrutiny from an advertising watchdog does not equate to lawsuits, it does point towards a move to increased regulation and rules surrounding social media advertising. As the market continues to develop, influencers may become more liable for false and incorrect advertising that they post on their pages.
By providing insurance coverage through its platform, Tailify will help to increase awareness among influencers about the risks that they carry while marketing products, improving the uptake of professional indemnity insurance. Indeed, if this type of cover becomes more important or even mandatory in the future, Tailify will be well placed in the market due to its early efforts in this regard.
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