Glossary of Business Insurance Terms
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Libel is the publication or display of untrue and defamatory statements or images that harm the reputation of an individual or organization.

What is the definition of libel?

Libel is a type of defamation that is seen by another person. It is false, written information that damages a person's reputation, exposes them to public hatred and ridicule, or causes a loss of income.

It could happen through just about any form that is published or displayed. This includes news media, blog posts, websites, social media, online reviews, signs, and advertising.

Libel should not be confused with offering a negative opinion. For example, if someone wrote an online review that a restaurant's food doesn't taste very good, it wouldn't be considered libel. If someone falsely wrote that the restaurant gave people food poisoning, it would likely be considered libel or a defamation of character.

If the local health department cited a restaurant as a source of food poisoning, a news article or blog that reported this information would not be considered libel.

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How to identify defamation and libelous statements

To prove that something is libelous, it must meet certain criteria:

  • It must be false.
  • It was communicated to another person.
  • It caused injury to someone, such as damaging a person's reputation or causing them financial loss.
  • It was made without adequate research to verify if it's true.

If the injured party is a public figure, such as a politician or a celebrity, a libel claim must also prove a statement was made with malicious intent, or a reckless disregard for the truth.

How to defend against libel lawsuits

Someone could defend themselves against a libel lawsuit by proving:

  • The published material was true.
  • It was made with the claimant's approval.
  • It was published or communicated accidentally.
  • It was privileged information (something communicated with or by an attorney that the defendant had a right to possess).

Libel vs. slander

Both libel and slander are examples of defamation. Libel involves material that is published or displayed, and then is seen by a third party. Slander is something said verbally to another person.

Torts and defamation law

While the First Amendment forbids the government from punishing people for what they write and publish, it doesn't protect you or your business from defamation claims.

Most libel suits fall under state jurisdiction. State courts follow the common law principles of defamation, which allows a legal cause of action without proof of actual harm. Under U.S. libel laws, simply demonstrating that something is a defamatory statement could be enough to support a liability claim.

Winning special damages from a defamation lawsuit is a different story. In the landmark 1964 case, New York Times Co. v. Sullivan, the U.S. Supreme Court ruled that the First Amendment limits someone's ability to claim damages in matters of public concern. A claimant would have to prove that someone acted with "actual malice" by publishing false statements about public officials.

Does business insurance protect against libel lawsuits?

General liability insurance covers common business risks such as bodily injury, as well as advertising injuries. If someone accuses your business of libel, the defamation insurance included in your general liability insurance policy covers your legal costs in part, along with any settlement or judgment.

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Updated: April 29, 2022
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Protect your business with general liability insuranceHow defamation insurance protects your small business from libel or slander lawsuitsLibel vs. slander: What’s the difference?What to expect when you’re accused of defamationSocial media and business risk: Slander, libel, invasion of privacy, and copyright infringement