UK small firms lack cover for social media legal claims

Research published by Markel Direct suggests many UK small businesses using social media lack insurance cover for legal claims linked to their online activity, even as many owners now see it as their most important marketing channel.

The insurer surveyed 501 UK small business owners and tradespeople about how they use social media to promote their work. Among those using it for business, 52% regarded it as their main marketing route, while 84% said their online presence generates at least some business.

The findings also highlighted a gap between social media's growing commercial role and the steps businesses are taking to protect themselves. Only 39% said they had insurance to cover legal action related to issues such as copyright infringement or breaches of confidentiality connected to social media activity. By contrast, 47% said they did not have that protection and 8% were unsure.

The results suggested some firms are posting material online without clear safeguards. Nearly one in five respondents, or 19%, said they do not always obtain client permission before sharing images or videos of completed work on social media.

More than a quarter, or 28%, said they would not know what steps to take if a client raised a legal concern about content shared online. The figures point to a wider lack of preparedness as social media work increasingly falls to owners and staff without specialist support.

Self-taught marketing

The research found that 77% manage their own social media accounts, while 69% have never hired a professional to create content on their behalf. A further 65% said they had never received any social media training.

These figures show how heavily many small businesses rely on in-house efforts to maintain an online presence. For tradespeople and owner-managed firms in particular, posting project updates, photographs and promotional material has become part of day-to-day business development.

That reliance helps explain why 72% said social media is necessary to stay competitive. For many smaller firms, platforms offering direct access to local customers have become a low-cost alternative to traditional advertising.

Yet the survey suggests the shift into online marketing has brought legal and operational risks that are not always well understood. Problems can arise when businesses post images from a client site, use music or photography without permission, or share material containing confidential or identifying details.

Rob Rees, Divisional director, Markel Direct, said: "Social media has become one of the most powerful ways for small businesses to showcase their expertise and attract new customers, but many business owners don't realise that the same rules around consent, copyright and confidentiality apply online as they do offline."

He added: "Many entrepreneurs have effectively become marketers overnight, often without formal training or dedicated support. Taking a few simple steps, such as obtaining written permission before sharing client projects and understanding what insurance protections are available, can help reduce the risk of disputes further down the line."

Risk controls

The findings were released alongside practical guidance for small businesses on managing social media risk. The advice focused on securing client permission before posting material, reviewing whether business insurance includes cover for media-related claims, and using only licensed music, images and other content.

Businesses were also urged to set basic internal rules on what can be shared online, especially where more than one person contributes to an account. Other recommendations included acting quickly if a client objects to a post, avoiding the publication of private information such as addresses or vehicle registration plates, and seeking legal advice if the implications of a post are unclear.

The data underlines a broader shift in how small firms market themselves. Social media may offer visibility and customer leads, but for many owners it also creates exposure that sits outside their traditional expertise.

With most respondents handling their own accounts and many lacking training or cover, the research suggests social media has become embedded in small business operations faster than risk management practices have kept pace. Among those surveyed, 47% said they do not have insurance protection for legal claims tied to social media activity.