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Why do I need contest official rules?
Contest official rules are required in order for your contest to be legal in the U.S.
If you run a contest that is open to residents from multiple states, you will need to make sure that you comply with the contest rules of each of those states.
In some cases, you may also be required to register your contest official rules with the state.
IN THIS ARTICLE:
- What should contest rules include?
- Can a contest administrator draft official rules?
- What is prize indemnity insurance?
What do contest official rules include?
Having your contest official rules drafted by a contest law expert might not be what some marketers choose to do but it’s the best solution to ensure that your contest is legally compliant.
While customizing your contest official rules, consider that you will need to manage both the legal and financial risks of running a contest or sweepstakes.
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You are required by law to have contest official rules that include the start and end dates, contest eligibility requirements, judging criteria, liability releases for participants to use their user-generated content and much more.
Also Read: What Are the Benefits of Running a Social Media Contest for Ecommerce?
No state will allow you to legally run a contest without contest official rules.
While you need to make sure that your promotion follows all applicable laws, hiring a professional contest company to draft your official rules is a smart decision for your brand.
You’ll spend some money to have professionals administer a contest on your behalf, protecting you from the legal and financial risks of contest marketing.
Prize indemnity insurance covers your sweepstakes prizes against financial risks and properly written contest rules protect your company legally.
Contest Official Rules Drafting
It will be up you to decide how much help you need with your contest. Drafting your own contest official rules, means increased risks for your brand.
Even if you’ve launched a contest before, you are still at risk for anything that goes wrong that isn’t properly covered by your official rules.
Also Read: What Are the Differences Between Sweepstakes and Contests?
Here is an overview of what needs to be included in contest official rules:
- Start and End Dates (Must be the same for all entry methods)
- No purchase necessary
- Number of prizes and a description of each prize, including the Average Retail Value (ARV)
- Eligibility (Location, Age)
- Winner selection, clearance and taxes
- Approvals and risk management
- Record keeping and winners list publishing
A contest administrator will also ensure that your social media contest complies with the social media platform TOS. For Instagram contest, Facebook contests, Twitter contests, Pinterest contests, influencer contests, and more.
What Do Liability Releases Have to Do With Contest Rules?
A release of liability form releases your company from liability if the contest winner misuse the prize. It also grants you permission to use the name of the contest winner and/or likeness for the purposes of marketing your brand.
What Is Contest Prize Indemnity Insurance?
Contest prize indemnity insurance addresses the potential financial risks of giving away a large or otherwise value prize. If you use prize indemnity insurance, the details of the insurance policy may need to be referenced in your contest official rules.
Some other common things to know about contest official rules:
Start and end dates – Every contest official rules needs to specify the dates of the promotion so that it’s clear when the contest rules are in effect for participants.
Contest eligibility requirements – The contest rules should mention any restrictions or exclusions on participation by location, age, affiliation with the contest sponsor and more. Some contests specifically exclude participants under 21 years of age or in certain jurisdictions, for example.
Contest judging – How will the contest be judged and by whom? Hiring a contest company to assist you with judging your contest is the best way to ensure that the judging is done fairly. If you plan to use contest judging services, your contest rules will need to mention this.