Market research firms are primarily engaged in gathering, recording, tabulating and presenting marketing and public opinion data. Whether you are a small firm or a large multi-location corporation, your clients count on you to perform scientifically sound and accurate research and to provide expert analyses of your findings.
Market research firms work with multiple clients and projects every day, requiring skill and attention to detail. Meanwhile, you must protect your business assets and livelihood from a wide variety of risk exposures that can cause you financial harm when you least expect it.
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Corporations, nonprofits, political candidates and other entities hire market research firms to provide a wide range of services on their behalf, including the following:
- Broadcast media rating services
- Political opinion polling
- Marketing analysis or research
- Statistical sampling services
- Opinion research
You may also use the data you compile to recommend marketing strategies for your clients.
Whatever services your market research firm specializes in, you are subject to a wide range of potential problems that can occur unexpectedly and threaten your assets. How would the following occurrences impact your ability to operate?
- Slips and falls at your office
- Weather events that destroy your business property (buildings and their contents)
- Fire or smoke in your office space
- Theft and vandalism in your office space
- Employee injuries while at work
- Lawsuits from clients, vendors or the general public
- Accusations of professional negligence
- Damage to a client’s property, caused by you or one of your employees
Business Insurance for Market Research Firms
Business insurance helps market research firms protect their assets with coverage for unexpected events. With the help of an independent insurance agent, you can determine the coverage you need, including the following:
- Commercial general liability (CGL) insurance: This covers injuries or property damage to third parties. If a client falls and suffers injuries at your office, this policy covers direct costs related to the claim (e.g., medical bills) as well as lawsuit-related costs (attorney fees, court costs, settlements or judgments) if you are sued. CGL insurance also pays for claims related to advertising liability, slander, libel, and unintentional or accidental copyright infringement.
- Business property coverage: This covers damage to building(s) and their contents if damaged by fire, wind, smoke, theft, vandalism and certain other causes of loss. If you lease your office space, business property insurance protects your office furniture, computers, fixtures and other business personal property.
- Business interruption coverage: This helps pay for ongoing expenses (salaries, rent) and lost income if fire or some other covered loss damages your office space and you must close or relocate while repairs are made.
You might be able to purchase a business owners policy, or BOP. A BOP is a packaged policy designed for small- to medium-sized businesses. It bundles property, liability and business interruption coverage into one convenient, affordable policy.
Only certain businesses qualify for a BOP; your agent can help you determine your eligibility.
Do You Need Professional Liability Insurance?
The impact of a disappointed client can reach far beyond the loss of that client's future business. Market research professionals might work with a large corporation, a political figure and a government entity all in one day. Each client hires you for your expertise and expects the research you conduct on its behalf to be scientific, accurate and effective.
If a client feels that you have made a mistake or oversight that results in a financial loss, you can be sued. If you don’t have appropriate insurance coverage, you must pay for your defense and any judgments against you. Your business and even your personal assets could be at risk.
Professional liability insurance, or errors and omission insurance, helps you pay for lawsuits related to oversights or mistakes you make in delivering your professional services. This type of coverage is not provided by your general liability policy.
Consider the following examples:
- Inaccurate results lead to a financial loss for a client.
- Erroneous analysis of data leads to a financial loss for a client.
- Your employees use unethical means to gather information.
- You or any of your employees commits any other type of professional negligence, including errors, omissions and oversights.
If you are sued, your professional liability policy helps you pay for your legal defense and any settlements or court-ordered judgments up to the limits of your policy. Remember, you have to defend yourself, even if a lawsuit is without merit. The costs to defend against any lawsuit can be prohibitive, and your business could be at risk.
Talk to your insurance agent about your need for professional liability insurance. Your agent can help you find a customized errors and omissions insurance policy that addresses the specific needs of a market research professional.
Don’t Forget About Vehicles, Computers and More
Besides basic property and liability coverage, you might want to consider the following types of coverage for your market research firm. Your insurance agent can help you determine which types of coverage you need, and which you don’t.
- Computers and media coverage — also called electronic data processing (EDP) insurance — pays for lost data and related lost income if your computers or network are damaged by theft, vandalism, viruses or malware. It may pay for loss of data or software and may pay for physical damage to computers or hardware.
- Business auto insurance covers any vehicles your company owns. It provides liability coverage if you or an employee injures someone or causes property damage while driving a company vehicle. If your employees drive personal vehicles for business purposes, you must have nonowned or hired auto liability coverage to protect your company from accident-related costs.
- Commercial umbrella insurance provides excess liability protection to any of several other policies you might have, including commercial general liability, employer’s liability, and hired and nonowned auto liability. By purchasing one commercial umbrella policy, you essentially get higher limits on all of those policies rather than having to raise the limits on each policy individually.
- Workers’ compensation insurance is typically required for any business that has employees, and pays for lost income and medical expenses for employees that are injured on the job.
- Cyber liability insurance provides coverage in the event of a data breach involving your business. It helps pay for the cost of notifying affected clients as well as the cost of public relations and investigations.
Find a Knowledgeable Agent for Comprehensive Business Insurance
In order to find the best coverage for your business, it is equally important to find the right insurance agent. Market research firms should seek an experienced independent agent who can work with insurance companies that specialize in coverage for marketing consultants and other similar businesses, like yours.
Together with your agent, you can assess your specific business risks and find the right mix of property, liability and specialty coverage to protect your assets from lawsuits and other claims.