Canada’s anti-spam legislation (CASL) came into effect on July 1, 2014. If a business is found guilty of violating this act, the maximum penalty is $1 million per violation for an individual and $10 million per violation for entities (such as corporations).

Under the new legislation, no one is exempt – not non-profits, not charities, not small business owners. Everyone is liable.

According to the law, if you solicit new business by sending emails (AWeber, Constant Contact, Mail Chimp, or even a group of contacts in Outlook), using Facebook, Twitter, text messages, or even leaving a voicemail to follow up with a new business referral, you could potentially be spamming.

The law itself is fairly easy to follow. However, if your network is hacked and used to send out spam emails, or if one of your employees mistakenly sends out a letter or an email to a client who asked to be removed from your mailing list, your business could be liable.

While fines have been rare so far, they could potentially cost your business millions of dollars. Even without a fine, the legal fees to defend against such complaints can be extremely expensive. The standard commercial policy does not cover these costs.

A Cyber Extension with lower limits is a good alternative compared to an expensive “stand-alone cyber policy”. This valuable coverage will protect you from the legal fees and other costs associated with defending yourself against a complaint for inadvertent spamming.

It is important that you speak with your insurance broker to make sure that you have the proper insurance coverages in place. Doing so will help protect your bottom line and provide peace of mind.