(352) 397-2705

Privacy Policies and Terms of Service On Your Website — Why They Are Important?

Sep 13, 2020 | Web Design

Person using a laptop

When creating a blog, a corporate website, an eCommerce site, or even a social media platform, you’d spend weeks perfecting your ‘About Us’ page, your landing pages, and other web copy. You’d probably enjoy working on these exciting sections until you reach the links at the bottom of the page labeled ‘Privacy Policies’ and ‘Terms of Service’.

Both Privacy Policies and Terms of Service are, no doubt, the dullest sections of any website that users hardly take the time to read. While there’s no legal requirement to define the Terms of the service for your website, if you aim to obtain users’ personal data, you are required by law to have a Privacy Policy page.

Yet, you should define not just Privacy Policies but also the Terms of Service, which sets the rules for using your website.

To understand more about the importance of privacy Policy and Terms of Service for your website, keep reading.

Defining the privacy policies for website

What is a Privacy Policy?

A privacy policy is a declaration on a website that defines how it aims to collect, store, utilize, and protect the personal data of users of the site. Personal data includes the names, date of birth, contact information, IP address, email address, mailing address, and of course, the financial information of users, including their credit and debit card details.

Besides, the statement also details how the company intends to meet its legal obligations, as well as the course of action users should take in the event that the company fails to fulfill its responsibilities. Now that you know what a Privacy Policy is, let’s find out why it’s important:

The Importance of a Privacy Policy

Required by Law

Any site in almost every country in the world that acquires user data, even if it means tracking their location, must have a Privacy Policy. In the present-day scenario, these might include websites that use cookies to track user behavior, possess subscription emails to send out newsletters, or eCommerce sites recording shoppers’ buying behavior. By November 2016, around 100 countries already data protection laws in place, while another 40 were in the process of implementing privacy laws.

Given the nature of the internet, websites can be accessed and used by people from all over the world. Therefore, a privacy policy must comply with the major standards, including those required in the US and Europe.

While the exact requirements vary from one country to another, the underlying features remain common, such as how the personal data is to be used and protected. Most websites would require users to agree that they have read the Privacy Policy when subscribing for marketing emails or sharing personal information for any other reason.

The US, Europe, and other regions may have different laws in place for consumer data protection, any business that wants to operate globally through their website must be aware of and comply with the policies applicable to their target markets. Let’s take a look at the privacy policy laws for the US and Europe:

Unites States

In the US, several data protection laws are in place that cover certain circumstances and demographics. The most recognized one is the Children’s Online Privacy Protection Act (COPPA), which regulates websites that:

  • Are targeted towards children aged under 13, regardless of whether they collect any data or not, and
  • Are not targeted towards children but knowingly obtain information from children under 13.

The most recent law similar to the above is the California Consumer Privacy Act (CCPA) that was passed in January 2020. It outlines certain regulations that must be met by websites meeting defined criteria and are accessible within the US. Based on these regulations, a website can collect a child’s data if their guardian or parent provides consent for this.


Any country that forms part of the European Economic Area (EEA) is required to ensure compliance with certain principles. The following are some features of the law:

  • The information acquired should be limited to that which is reasonably necessary for the purpose of the website
  • How users may access their data
  • How the data is protected
  • The Accountability of the website collecting data

The General Data Protection Regulations (GDPR) was enacted across the EEA in May 2016. Based on these regulations, any company with a website accessible from Europe must comply with the GDPR, no matter where the business is based

Site Usage

In addition to the above, what you choose to do through your website may also make it necessary to define privacy policies. For example, leveraging third-party advertising and payment processing through websites also require you to have a privacy policy on your website with the relevant details. Let’s find out more:

Payment Processing

Websites that process payments must have a solid privacy policy in place. This is because in addition to the names and addresses of users, such sites collect sensitive information from users such as their credit and debit card details. Data theft for such information could put the users in trouble. Therefore, the privacy policy must clarify what security measures have been adopted to protect the data.

Third-Party Advertising

Certain platforms and programs, such as Amazon Affiliates and Google AdSense, or even a simple blog, earn by providing advertising space on their sites. Websites take part in these schemes for website monetization. But before they can do so, they must have clearly defined website policies on their sites as the schemes involve sharing of user data.

Creating a Privacy Policy

Don’t consider copying a privacy policy from another site. Different websites represent different businesses that offer different products and services, which should be reflected in the privacy policy. Another company’s privacy policy may not cover everything you must declare in your privacy policy statement, and you may not comply with the regulatory requirements as a result.

Many business owners use templates to create a privacy policy for their website, but these are often too generic, presenting the same problem as with copying another website’s privacy policy. Consider using a suitable privacy policy generator that has been drafted by qualified lawyers instead.

The content of your website’s privacy policy depends on your site’s function and the information it collects and uses. Following are some of the common elements of a privacy policy:

  • The specific information that your website will collect from visitors
  • In the case that cookies are used on the website, what impact it may have on user experience, and how to opt out of it
  • How the data will be collected
  • How the data will be utilized, and whether or not it will be shared with any third-party
  • How the data is protected or secured from unauthorized access or misuse
  • How users can opt out of data sharing, and what that means for them

Privacy Policy and Terms of Use are among the most ignored sections on any website, but they happen to be one of the most critical pages for your business.

Defining the terms of service for website

What Are Terms of Service (ToS)?

Also known as Terms and Conditions (T&C) or Terms of Use (ToU), the Terms of Service page on a website details the responsibilities and rights of anyone using the site, serving as a contract between the website and its users. It would typically define the key terms used in the statement and go on to explain the legal limitations of responsibility of the website owner for any harm or damage faced by anyone while using the site.

It also outlines the intellectual rights of the website owner and what action may be taken against a user who violates the terms or infringes the intellectual property (IP).

Importance of Terms of Service

Since the Terms of Service statement forms the legal basis of the website’s relationship with a user, you should certainly include it on your website. In the event that a user makes a claim against your business or website, or you need to sue a user for some reason, the Terms of Service (ToS) will serve as the basis for assessing how valid the complaint is.

Hence, you should not only have the Terms of Service page on your website, but also ensure that it’s strong enough to limit your liability and to protect you in case you face legal action.

Creating a Terms of Service Page for Your Website

Like a Privacy Policy, you should develop your own Terms of Service statement for your website. The most reliable and secure approach to create the Terms of Service is to use an online platform that generates custom policies tailored to your business needs.

As far as the content of the statement is concerned, the exact terms will vary depending on the type of website and the services it offers. But to give you an idea, here are some of the common features of the Terms of Service:

Country of Governance

This is where you should disclose the name of the country where your website is based and thus, the nation whose laws govern the Terms of Service.

Limitation of Liability

This section should exempt the website owner from any liability that arises for any information errors on the website. If the platform allows visitors to add content or engage with any content on the website, such as on social media platforms or forums, include a section in the Terms of Use statement that removes any accountability on your part for posts or content that may regarded as offensive.

You might want to state that any content shared by a third-party on your site is by no means endorsed by the owner of the site and doesn’t represent their opinion.

Abuses of the Site

This particularly applies to any site that allows users to post content and/or engage with the posted content. In this section, you should detail the activities or situations that would be regarded as abuses of the website and what would be the consequences of such actions.

The Change Clause

This is an individual clause that you add to the Terms of Use statement of your website. By including this clause, you clarify that the site owners of the site have the right to change or modify the agreement without informing the users, at any point in time.

You may want to notify the users of any changes to the terms through emails or by including a notice on the website. Yet, be sure to add the change clause, stating that the responsibility of checking any amendments in the agreement rests on the users of the site.

While these were only a few critical sections, the complete Terms of Use agreement will cover many more aspects regarding how the website is run and operated.

Final Word

While it’s true that Privacy Policy and Terms of Use are among the most ignored sections on any website, they happen to be one of the most critical pages for your business. Not including either of the two could have serious implications for your website and the overall business, such as in the form of fines and compensatory payments to users that may sue your platform or business.

Now that you know the importance of Privacy Policy and Terms of Service for your website and how to create them, go ahead and proceed to complete your website development. If you’re looking for high-quality, top-notch web development services, get in touch with Nora Kramer Designs.

We partner with a service that was created by a lawyer that generates your various policies and keeps them up to date when laws change automatically. If you are working with us on a new website design, ask us about this. It’s fabulous and, for what you get, the price can’t be beat!


Nora Kramer Designs, Team 2
Latest posts by Nora Kramer Designs, Team 2 (see all)

Want to work with us?

We would love to talk with you and see if we are a good fit for each other on a project! Please schedule a call to get started.

Click To Call