Running Facebook ads for a friend's wholesale business for $500 a month, what insurance am I missing

Question

A guy I know wholesales and asked if I'd run his Facebook ads. He'd pay me $500 a month and put $1,500 on the card for spend. I've built landing pages before and I can read a dashboard, so I said probably yes.

Then it occurred to me I have no idea what happens if something goes wrong. Like if an ad gets rejected and his money sits there, or if I write something in the ad that turns out to be a problem legally. Do people running this kind of thing carry insurance? Is $500 a month even the kind of arrangement where anyone asks?

Rena Guide · Accepted Answer

Two kinds of coverage come up for small marketing shops. General liability handles ordinary bodily injury and property damage claims, and it's often what a client's contract requires before they'll pay you. Professional liability, usually called errors and omissions or E&O, covers claims that your work caused a financial loss, which is the one that matters when someone says your campaign wasted their money or your copy caused them a problem. Small independent shops often see annual premiums in the low four figures for a modest policy, though what's available and what it costs varies by state and by insurer, so a broker who writes for agencies is the person to ask.

On the ad content: platforms put housing-related advertising into a special category that restricts targeting by age, gender, and narrow geography, which is why hollow's radius got widened. Whether a particular ad or targeting choice creates fair housing exposure depends on how the statute applies to the facts, and that's a question for an attorney, not a forum.

The part of your setup I'd fix first is the card. If the $1,500 sits on your payment method, you are the one the platform bills, and a declined card or a chargeback becomes your problem while his leads stop. Run the campaigns inside his own business account, with his billing attached, and take an admin seat. You get access to everything you need and none of the spend liability. Get the arrangement written down even at $500, including who owns the ad account and the pixel data when you stop.

laurenkim53 · Answer

The rejection thing bit me before I ever got to insurance. Housing ads on Meta land in a restricted category, and my radius targeting around a small county got cut down to something like a 15 mile minimum, which in rural terms is three towns I don't buy in. Ads didn't get rejected, they just stopped being useful. The agency I talked to afterward listed E&O coverage in their proposal without me asking, so somebody's clients are asking.

samantha_ruiz · Answer

Every agency contract I've been handed put the indemnity on me, the client, for claims arising from the ads. Which is the opposite direction from what you're worried about, and it's normal, since I'm the one who buys houses and makes the promises. Separate point: $500 a month. If you spend five hours a week on it you're at $25 an hour before you pay for a single tool. Ask yourself what happens in month three when he wants creative rewritten twice a week.

Rena Expert · Answer

Keystone's hourly math is the real constraint here. At $500 a month, an E&O premium of say $1,200 a year eats two months of revenue, and that's before an entity, an accountant, and whatever design or landing page tool you end up paying for. One client at that price doesn't support carrying insurance. Three or four does, which is why the small shops that survive either raise the floor to $1,000 to $1,500 a month or move to percentage of spend with a minimum.

The exposure you should think hardest about isn't the ad rejection, it's the copy. Wholesale creative tends toward "cash in 7 days, any condition, no fees." If he doesn't close in 7 days, or he assigns for a fee the seller didn't expect, the complaint attaches to the promise. Ask now whether you write the copy or he approves it in writing, and keep the approvals. Whether that shifts any liability is a lawyer question, and several states regulate what a buyer of distressed property can say in advertising, so his attorney should look at the claims before they run.

Practical thing you'll hit in week two: he'll want leads in his CRM, and the Meta lead form connection breaks whenever a token expires. Nobody notices for four days. Set up an email copy of every lead as a backup and check the two counts weekly, because when leads go missing the client assumes the ads stopped working and the invoice conversation gets ugly.

Running Facebook ads for a friend's wholesale business for $500 a month, what insurance am I missing

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