Homeowner insurance policies may be increasingly called upon to cover liability if individuals comment online through social media such as blogs, Facebook or Twitter and are sued for defamation as a result.
With the surging popularity of social networking services, anyone can air a grievance, defame a company or slander a person online. Postings, like thoughts spoken aloud, are sometimes written in the heat of emotion. Thousands may see the message instantaneously.
Some companies have begun to fight back, filing defamation claims against individuals for posting critical comments online. In the next few years, insurers may find themselves dealing with more claims under homeowners’ polices that provide liability coverage for “personal injury” as a result of online defamation.
“Defamation” is an untrue publication that tends to generally lower a person in the estimation of right-thinking members of society. It is an injury to a person’s reputation, and is considered a type of personal injury by the courts for the purposes of coverage.
Canadian courts have confirmed that the internet is not a tool that can be used “with impunity to spray libellous electronic graffiti in cyberspace,” and that the traditional laws of defamation apply to online statements as well as those published in print media.
To date, there have been very few cases in Canada dealing with online defamation and the duty to defend an insured under homeowners’ policies. In the 2003 case of Hodgkinson v. Economical Mutual Insurance Company , the Ontario Court of Appeal considered whether an insurance company had a duty to defend a man who had posted defamatory comments online.
In Hodgkinson, the insured posted comments on an online bulletin board, accusing the plaintiff of improper financial dealings and insider trading. After he was sued, he argued that his insurance company had a duty to defend him under his homeowners’ policy. The insurance company argued that there was no duty to defend, on the basis that the plaintiff intended to injure the defendant with his comments and therefore the intentional acts exclusion in the homeowners policy applied.
Although the Ontario Court of Appeal ultimately determined the insured’s homeowners’ policy was not engaged in this particular case, it noted that defamation can be accidental, and therefore can fall outside an intentional acts exclusion.
Given the incredible popularity of social media services and the tendency of some people to document their every thought online, it is likely that insurers will face more cases arising out of something the insured blogged, tweeted or posted on Facebook.