Companies that employ auto-dialing, text messaging and bulk faxing in their marketing efforts may find themselves the subject of a class action lawsuit for violating the federal Telephone Consumer Protection Act (TCPA). Because each violation of the TCPA could cost the advertiser up to $1,500, TCPA class actions could potentially involve millions in liability, and can be enormously expensive to defend. Insurance often is a critical lifeline for companies facing these lawsuits.
It used to be that the “personal and advertising injury” coverage within general liability (GL) policies at least potentially protected against TCPA lawsuits. But in recent years, many GL policies have added exclusions to their policies that specifically apply to coverage for TCPA-related claims. So today’s companies need to be more proactive in finding coverage for TCPA claims, but absolutely should not give up just because their GL policy excludes TCPA claims.
