On the Web

Need for on­line rep­u­ta­tion in­sur­ance

Enterprise - - Contents -

As a ris­ing trend, peo­ple are not any­more asked to pro­vide job ref­er­ences or back­ground in­for­ma­tion. In­stead, they are in­stantly searched for and in­ves­ti­gated on the in­ter­net.

In­ter­est­ingly, not just in­di­vid­u­als, but al­most 90 per­cent of con­sumers re­search com­pa­nies on­line be­fore do­ing busi­ness with them. If the search turns up news re­ports, le­gal fil­ings, em­bar­rass­ing pho­tos, or other ques­tion­able ma­te­rial, the op­por­tu­nity is likely to get passed over.

If a com­pany’s rep­u­ta­tion takes a nose dive on­line, it has a real chance of go­ing out of busi­ness. Rep­u­ta­tion is the most im­por­tant as­set a com­pany pos­sesses. The Econ­o­mist In­tel­li­gence Unit has found that 75 per­cent of a com­pany’s value is tied up in its rep­u­ta­tion. When a com­pany’s name gets tar­nished be­cause its ex­ec­u­tives are scan­dal­ized, a dis­as­ter oc­curs, or work­place con­di­tions are crit­i­cized, rev­enue falls, the stock price slides and the ac­qui­si­tion of new cus­tomers slows down.

To­day, rep­u­ta­tion lives on the In­ter­net. More than 90 per­cent of con­sumers use the web to re­search com­pa­nies and prod­ucts be­fore buy­ing and 80 per­cent make de­ci­sions based on what they see on­line. If a dis­grun­tled for­mer em­ployee is slan­der­ing the busi­ness on­line, cus­tomers would not take the time to eval­u­ate the com­pany’s prod­ucts fur­ther— they will most likely pre­fer do­ing busi­ness with the com­peti­tors.

There are two kinds of rep­u­ta­tion in­sur­ance that can be of im­por­tance to the busi­ness’ on­line pres­ence. The first is “in­for­mal in­sur­ance”; build­ing up dig­i­tal rep­u­ta­tions be­fore prob­lems oc­cur by mak­ing sure com­pa­nies con­trol the top 20 Google re­sults for their names and own the Twit­ter, Linkedin and Face­book ac­counts for those names. Busi­nesses man­age their rep­u­ta­tions proac­tively by mak­ing sure the In­ter­net ac­cu­rately re­flects their off­line suc­cesses. When such com­pa­nies suf­fer In­ter­net at­tacks, they al­ready en­joy “pro­phy­lac­tic” lay­ers of tech­ni­cal pro­tec­tion.

The sec­ond is “for­mal in­sur­ance” - a le­git­i­mate in­sur­ance pol­icy, like peo­ple would get for their car, health or life. It is dif­fer­ent than the ser­vice that will pro­tect the first few pages of Google from neg­a­tive con­tent from be­ing ex­posed. Rep­u­ta­tion In­sur­ance is very sim­i­lar to Er­rors & Omis­sions ( E& O), pro­fes­sional li­a­bil­ity or any­thing else that pro­tects a com­pany. Over quite some time now, a grow­ing num­ber of or­ga­ni­za­tions have been de­mand­ing ded­i­cated rep­u­ta­tion in­sur­ance prod­ucts in the same way they buy Er­rors & Omis­sions in­sur­ance, data breach in­sur­ance and pro­fes­sional li­a­bil­ity in­sur­ance.

Busi­nesses and in­di­vid­u­als at risk of be­ing ma­ligned on on­line fo­rums, so­cial me­dia, blogs and web­sites should look into buy­ing in­sur­ance specif­i­cally in­tended to guard their rep­u­ta­tion on the In­ter­net.

Ex­perts are cu­ri­ous to find the evo­lu­tion of a big on­line rep­u­ta­tion in­sur­ance mar­ket, which not only ap­pears to be smart but also in­evitable. But ap­pre­hen­sions ex­ist over the in­dus­try of rep­u­ta­tion in­sur­ance to be a lit­tle more sub­jec­tive than what E& O in­sur­ance is, which may make it dif­fi­cult to draw the line, once the money starts com­ing in.

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