The privacy policy is very important to create because the Federal Trade Commission requires it.  As a legal document, I would suggest you get legal help in writing this document.

The privacy policy is designed to protect your customer information.  In fact, in the privacy policy you have to describe how you are going to collect information from your visitors and customers that come to your site.  You need to talk about what you do with the information you get.  Also, if you intend to share that information you collect with another site or company, you need to disclose that in your policy.

Your customers or visitors needs to know if your site uses cookies.  Cookies are bits of code that tracks your customers and the websites they visit.

Also, you need to tell them how they can remove these cookies from  their computer.

There are websites that will write a privacy policy for you just search creating a privacy policy.  Like I said before this is a legal document so I feel legal help is needed.

You need to understand what your website is going to be doing when visitors go to your site.  Also you need to understand how and why your website is using these cookies.  Their is a lot of information out there on this subject of cookies.  If a customer learns she does have cookies on her browser.  She might want to get them removed.  So how does she remove the cookies from her computer.  The answer is she goes to tools section and it will tell her the way to get cookies out of her browser.   By the way, cookies attach themselves to the customer’s browser.  In my opinion, it does not hurt anything, but some people do not want them on their browser.

My whole point is take writing and understanding privacy policy very seriously.