Technology Business Insurance
Get free technology business insurance quotes to protect your tech business now.
Call Now: (844) 524-6500
Technology Business Insurance Quotes
During this time of explosive growth in high-tech and internet commerce, many companies are finding (much to their dismay) that their traditional liability coverage doesn’t cover claims for things like intellectual property infringement, programming errors, non-functioning software, or major system crashes.
Technology Business Insurance pays for such claims from clients and all associated legal, claim investigation, and claim settlement fees. As with other types of business liability insurance, it usually also protects from costs associated with groundless claims.
What Technology Business Insurance Is Not
Many traditional Commercial General Liability (CGL) policies exclude certain technology-related risks. CGL policies typically focus on tangible losses to property or bodily damage to people. Intangible loss (like intellectual property infringement, software malfunction, or data loss) is a much more complicated matter.
Some CGL policies do cover certain intangible losses called advertising injury, but such coverage doesn’t usually apply to purported losses that aren’t directly tied to a company’s advertising.
Who Needs Technology Business Insurance?
Tech Business Insurance is strongly recommended for all high-tech and internet-based companies, including software developers, programmers, Information Technology (IT) businesses, systems analysts and designers, website developers, and Internet Service Providers (ISPs).
Non high-tech/internet companies that rely heavily on technology solutions (like database management, customer e-mail, computer networks, communication via company intranet) for their business survival may also want to take a closer look at this type of insurance.
Things To Think About
If you think you might need Tech Business Insurance, take a very close look at your existing CGL, D&O, and E&O coverage. Find out exactly what is and isn’t covered. Pay particular attention to named exclusions.
If you decide your exposure from technology or internet risks warrants special coverage, then make sure your expanded coverage covers the specific activities you engage in. Again, pay careful attention to all exclusions.
Also make sure the policy covers the right people. For example, does it cover part-time and contract workers? Former and retired employees? Consultants? Board members?
Find your State-specific Insurance Guidelines
Choose a state:
Frequently Asked Questions (FAQs)
Get clear answers to common insurance questions and important details to guide your coverage decisions.
What is Tech Business Liability Insurance?
Tech Business Liability Insurance, also known as Technology Errors and Omissions (E&O) insurance, provides financial protection for technology companies against claims of errors, negligence, or omissions in the products or services they provide. This coverage is essential for safeguarding businesses from lawsuits arising due to software bugs, system failures, or unmet project expectations.
Why do technology companies need Professional Liability Insurance?
Technology companies are at the forefront of innovation, providing solutions that are critical to their clients’ operations. A single error—such as a software malfunction, a failed IT system implementation, or security vulnerabilities—can lead to financial losses, project delays, or reputational harm. Liability insurance protects your business by covering legal defense costs, settlements, and judgments.
What does Tech Business Professional Liability Insurance cover?
This insurance covers claims related to: Software Errors or Bugs (faulty code leading to financial loss for a client), System Downtime (failures in IT systems causing operational disruptions), Data Mismanagement (errors leading to loss or misuse of sensitive client data), and Negligent Advice (recommendations that lead to unexpected costs or business losses for a client).
What is not covered by Tech Business Professional Liability Insurance?
This insurance typically excludes: Intentional Misconduct or Fraud (deliberate wrongful acts), Bodily Injuries or Physical Property Damage (covered under General Liability Insurance), Cybersecurity Breaches (data breaches or ransomware attacks, which require Cyber Liability Insurance), and Contract Disputes (claims related to non-performance or disagreements over deliverables may not be fully covered).
How much does Tech Business Professional Liability Insurance cost?
The cost of coverage depends on factors like: Business Size and Scope (larger businesses or those handling high-value contracts may pay higher premiums), Risk Profile (companies providing high-risk services, such as cybersecurity or financial software, may face increased costs), and Claims History (a clean record can help reduce premiums). Typical Costs: Small Startups: $500–$1,500 annually. Established Firms: $2,000 or more annually, depending on the complexity of services provided.
How can tech businesses reduce their insurance premiums?
To lower premiums: Implement Strong Risk Management Practices (regularly test and review software before deployment), Document Agreements Clearly (maintain detailed contracts specifying deliverables and responsibilities), and Bundle Policies (combine Professional Liability with Cyber Liability or General Liability for potential discounts).
How do I choose the right Tech Business Liability Insurance policy?
When selecting a policy: Assess Your Risks (consider specific risks such as software glitches, data management errors, and system failures), Customize Coverage (tailor your policy to address high-risk areas like data security or critical system implementations), Work with an Expert (consult with an insurance professional experienced in tech-related policies to ensure all aspects of your business are covered), and Review Regularly (update your policy annually as your business grows or new risks emerge).
What additional insurance should technology companies consider?
In addition to Professional Liability Insurance, tech companies should consider: Cyber Liability Insurance (covers data breaches, ransomware attacks, and other cyber threats), General Liability Insurance (covers physical injuries or property damage caused by business operations), and Business Interruption Insurance (protects income during unexpected disruptions, such as a cyberattack).
Relevant EINSURANCE Journal Content
Claims-Made VS Occurrence Policies
