In an ever-changing world where more and more companies operate remotely, cyber attacks are a growing concern. Learn who needs technology errors and omissions insurance and how it works.
As a diligent business owner, you already have business insurance covering your property, liability, and auto risks, but do you know if you need technology errors and omissions insurance? If you run an information technology company, the answer is yes. Technology E&O protects from intangible risks like faulty software or data losses that negatively impact your clients.
Technology errors and omissions coverage is insurance for IT services. In many businesses, their products are tangible items or services like food products or floor installation. Those businesses can cover their products or services through general liability insurance. But how do you protect something that doesn’t fit well into either category?
As a tech company, you may sell software or write code for a client’s website. A software product can’t give a client food poisoning, and writing code for a website can’t cause property damage in a client’s office. So, what does technology errors and omissions cover? In short, this coverage exists to protect you from lawsuits filed by clients who were negatively impacted by your services or software.
Maybe you failed to have a website live by the deadline you and the client agreed on, and they lost business because of this. Or perhaps software you sold to a client was faulty and erased important, irreplaceable data. Both of these events could result in lawsuit expenses and settlement costs that technology errors and omissions insurance would cover. For companies providing technology services, a technology E&O policy could save them from these financial repercussions.
Cyber liability insurance and technology errors and omissions might sound like the same thing, but they cover separate risks. In some instances, a technology business might need technology E&O and cyber insurance to adequately cover their risks. Any company that conducts business over the internet can benefit from cyber insurance, which covers your business in the event of a data breach or cyber attack. Cyber insurance policies can also help with recovering data, repairing damaged systems, and the loss of income resulting from a cyber attack.
An information technology business owner should protect themselves from service-related lawsuits, but they would also be benefited from cyber insurance because cyber attacks can happen to anyone. If an IT business sells faulty software to a company that loses money from lost business, technology errors and omissions insurance pays for lawsuit costs and damages. But if an IT company is affected internally by a ransomware attack, their cyber insurance policy would pay for the ransom costs and lost profits.
Still not sure if you need technology errors and omissions insurance? Our insurance experts can help determine if this coverage is right for you and find the policy you need.
Information technology companies provide a vital service in our increasingly virtual world. An unexpected client lawsuit could have a catastrophic impact on your IT business. Technology errors and omissions insurance offers unique coverage to protect your interests and keep your business safe.
If you run an IT company and are concerned about the risks that face your industry, our insurance experts at Southpoint can help identify your coverage needs and find the best policy for you. Because technology errors and omissions coverage is a niche product, finding coverage can pose a challenge. Our insurance experts have long-lasting relationships with various carrier partners and can shop your coverage to find the best carrier for you.
Our experts at Southpoint can provide you with technology errors and omissions quotes from multiple carriers and help you select the coverage that best suits your business needs. Your business has distinctive risks that could leave you vulnerable to an expensive lawsuit. Don’t wait until you have already suffered a client suit to cover your IT business—contact us now to explore your options.