Student papers turn to insurance for protection from libel lawsuits

Though controversial, editors contend coverage helps -- even when truth is on their side

Kelly Wolff, general manager of the Educational Media Company at Virginia Tech, which publishes three student publications and operates a student-run television and radio station, said she was glad the company had insurance both times it was sued for libel.

Although the lawsuits were both eventually thrown out on appeal, Wolff said having insurance gave the company peace of mind.

"I think that is the reason for having it," Wolff said, "Mistakes happen. People can sue somebody whenever they want to, whether they really have a case or not."

Wolff would not disclose the particulars of the company's policy with the Arizona-based Scottsdale Insurance Company, but said the paper's total yearly budget is between $600,000 and $700,000.

"If our corporation lost a lawsuit that wasn't covered by insurance, we might not exist," Wolff said. "I don't think it would make a lot of sense to operate without it."

The Daily Collegian at Penn State University has had libel insurance through Bermuda's Mutual Insurance Company since 1989.

The Collegian, which has an annual budget of $1.7 million, is covered for $2 million per event. The deductible is $10,000 in addition to the premium, which is $4,308 for the current year. The policy covers three publications produced by The Collegian and a Web site.

"It gives us a level of security," said Patricia Hartranft, Collegian operations manager.

But Hartranft said it is important not to give anyone a reason to file a libel suit.

"We don't say, 'Oh well let's just run with it because we are insured," said Hartranft.

Nancy Green, vice president for communication at Georgia Global Learning Online for Business and Education, an online learning initiative of the University of Georgia, believes that libel insurance can do more than protect the budget of a student media corporation.

"[Having insurance] stands as a signal that you are sincere and also very professional in the way you approach your coverage and the work that you do," she said.

But others argue that some publications may be wasting their money on libel insurance and could even be encouraging lawsuits by joining forces with a company that has deep pockets.

"Successful lawsuits against college newspapers for libel are extremely rare," said James Tidwell, media law committee chair for College Media Advisers. "All things being equal, it is probably not a good use of resources."

"In small operations, it wouldn't be worth the money you would spend," Tidwell said.

He also said that in theory, having libel insurance could encourage people to proceed with a lawsuit they otherwise would not pursue.

Green said most people who would sue for libel probably would not know whether the publication had insurance.

"Normally you don't put on your masthead that you have libel insurance," Green said.

While Green and Tidwell agreed that libel insurance for smaller publications may not be financially prudent, or even possible, the general consensus among media law experts is that for larger media organizations, libel insurance is worthwhile. Green said any publication that generates more than $750,000 a year should consider investing in libel insurance.

View a list of libel insurance providers available from our legal resource center.

reports, Spring 2000