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Disclaimers are a great way to mitigate risk. When you operate as a business, you assume a lot of legal responsibility, whether online or not. Shift some of the liability back to your customers, especially for situations beyond your control.
In this article, we’ve shared what business owners should know about disclaimers in general:
What is a Disclaimer?
Disclaimers are legal texts that offer businesses protection from legal liability. They shield a company from legal claims associated with user and third-party risk. In general, customers must agree to all terms and conditions before using a product or service.
Here is an article which also defines disclaimers.
What is a Disclaimer Used For?
A disclaimer is used to protect your company from claims. You can utilize a disclaimer to limit the scope of your rights and responsibilities. Both parties can exercise and enforce these terms in a contractual relationship.
A disclaimer is also vital to protect you from third-party claims. They’ll let your users know that you’re not responsible for any damages related to the use of your website, services, products, and those with whom you affiliate.
What a Disclaimer Doesn’t Cover
If a consumer files a legal claim against your company, your disclaimers will provide you with the legal lifeline you need. However, disclaimers don’t shield you from acts of gross negligence.
For example, if you’re a SaaS provider, you must ensure that you’re working in good faith to guarantee system uptime. This guarantee means that you’re upgrading equipment, conducting routine maintenance, and more. Customers can hold you liable for their associated losses when the system goes down too frequently due to carelessness.
Types of Disclaimers
Contract law offers flexibility when it comes to using disclaimers. As such, there are several types of disclaimers that a business might want to know about and use.
Below, we’ve described ten different types of disclaimers:
Type 1. Third-Party Disclaimers
Most websites include links to other websites or services. It’s a way for the website to earn credibility, increase traffic, or build a brand.
These “third-party services” usually sponsor affiliate links strategically to generate revenue. This disclaimer informs users that your site contains third-party links, and users click them at their own risk.
Type 2. Warranty Disclaimers
Websites most often use warranty disclaimers. These disclaimers state what the website does and does not promise to users. They also acknowledge that you aren’t responsible for claims arising from service unavailability.
Type 3. Limitation of Liability Disclaimers
A limitation of liability specifies the extent of your responsibilities and obligations. This disclaimer is essential for safeguarding your website if a user encounters issues while using your site. Limitation of liability disclaimers make it clear that subsequent damages are not your fault.
Type 4. Industry-Specific Disclaimers
Industry-specific disclaimers do not apply to all websites. Think about including industry-specific disclaimers if you have a website or blog that offers tips, advice, or sells products in:
Governing bodies and associations generally determine which disclaimers are necessary. Check with their offices if you have questions about your requirements.
Type 5. Shipping Disclaimers
Shipping disclaimers are for eCommerce websites that ship their products to customers. A shipping disclaimer limits your liability when something goes wrong, such as damage and delays, beyond your control.
Type 6. Product Return Disclaimers
Product return disclaimers, like shipping disclaimers, outline restrictions that apply to customer returns and exchanges. For eCommerce stores, it’s a must-have.
They’re usually found in a Return Policy. Some stores have many restrictions, while others have few. Others, such as final sale items, allow returns, and others don’t.
Type 7. Expressed Opinions Disclaimer
Expressed opinions disclaimers inform users that the author’s views and opinions are solely their own. They generally release a publisher from claims. Otherwise, readers might reasonably assume the opposite.
Type 8. Past Performance Disclaimer
Past performance disclaimers protect a company from former outcomes. For example, diet supplements may describe an average weight loss for a control group but don’t guarantee the same results for every customer. While the product or service works as intended, a company cannot become liable for every failure.
Type 9. Professional Advice Disclaimers
Advice from authors, doctors, lawyers, accountants, and business owners use disclaimers to protect themselves from specific legal actions. Professional advice disclaimers are helpful if users misinterpret published materials as guidance for their unique situation.
Many businesses purchase general or professional liability insurance to protect them after being hired. Your insurance company may require your customers to sign a release of liability with a release clause for enforceability purposes.
Type 10. Errors & Omissions (E&O) Disclaimers
Another major issue that many unwitting website owners face is accuracy. It’s common to publish factual errors and misleading content, but it exposes you to liability even when it’s unintentional. Use an errors & omissions disclaimer to protect you from these types of claims.
Image via Pexels by Karolina
What’s Typically Included in Disclaimer Language?
Disclaimer language typically includes terms and conditions that limit company liability. However, it’s hard to imagine what that looks like if it’s your first time drafting one.
Every disclaimer is unique, which means that the language in each one is different. As such, the best approach understands what type of disclaimer you need and shaping it based on the principles below:
Relevant Terms and Conditions
Disclaimer language typically includes information that is suitable for the specific situation. It should also be relevant to the end-user or customer.
Clear Legal Language
It’s wise to make your disclaimer clauses unambiguous. There’s an ongoing misnomer that complicated agreements are better. This assertion isn’t true.
Transparent terms and conditions help users quickly find information that they need. This simple feature alone can avoid many future problems.
It would help if you also prioritized a full review of your disclaimers before publishing. Analyze the text to ensure that words cannot be misapplied or misunderstood.
People often misinterpret information, which isn’t your fault, but you can lessen the chance of dealing with a complaint in the first place.
Ensure that your disclaimers are factual. You also can’t apply disclaimers to non-legitimate business purposes and still expect them to achieve enforceability. Write your disclaimers so that they are accurate, honest, and fact-based.
Knowing which type of disclaimer to use is one of the most challenging aspects of using one. How would you know if you have the right kind? We recommend, at a minimum, reviewing real-life disclaimer examples to help you solidify your understanding, especially for more complicated situations.
Here’s an example of how a lawyer would apply a disclaimer to their website:
- Marc is a lawyer in New Mexico
- He is building a website for his law firm
- Marc plans to share legal information that attracts website visitors
- He’s concerned about visitors interpreting his website as legal advice
- Marc limits his liability by placing a disclaimer in the footer of his website
- He decides to use an industry-specific disclaimer for lawyers
- The legal industry uses professional advice disclaimers in general
- Visitors understand that they may not sue Marc for his website content when he applies a professional advice disclaimer to his website
They’ll not only help you work through crucial legal issues, but they’ll also help you handle the process entirely. From offering thoughts on a consent form to the contract signing, speak with a legal professional for the best result.
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