AIG’s Lexington Insurance Company now offers celebrity endorsement insurance so when a famous spokesperson is caught on tape doing something unconscionable, his damaged reputation affects the company’s bottom line as little as possible.
“In this age of social media and instant news, reports of indiscretions by celebrities or high profile athletes can spread worldwide instantly, with swift, adverse implications for products or brands associated with the individual,” Lexington president Jeremy Johnson said in a statement.
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This Celebrity Product RecallResponse “is triggered by significant news media coverage of an endorser’s actual or alleged criminal act or other distasteful conduct that results in (or is likely to result in) public contempt for the individual and a significant adverse impact on a company’s product,” AIG explained.
The insurance covers the removal and destruction of advertisements and products affiliated with the celebrity. Coverage is available with standalone policy limits up to $5 million or by endorsement with limits up to $1 million. AIG will also help endorsement insurance policyholders assess exposure and prepare a recall plan.
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Would you hire a celebrity endorser for your brand? Is the extra attention worth the possibility of bad press? Let us know what you think using the comments section below.