Information Technology Insurance

Information Technology Insurance

Information technology professionals and companies are liable for the products and services they provide to their clients.

Get comprehensive information technology insurance to protect your business and assets.

Zensurance - Information Technology Professional

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IT Business Owner

Insurance for information technology companies

Information Technology (IT) companies provide various services and solutions related to technology and digital systems. Their primary focus is on leveraging technology to address the needs of businesses, organizations, and individuals.

From software development, cloud computing and storage, and helpdesk services to IT consulting and data management, IT firms and professionals ensure their clients’ technology needs are met. But IT companies face various liability risks that require a customized information technology insurance policy to protect them from damage and loss.

Information technology insurance, or IT professional liability insurance, is a specialized form of insurance coverage designed to protect IT companies and professionals from potential financial losses associated with technology-related risks and liability claims.

Allegations of professional negligence, privacy violations, service interruptions, and inadequate cybersecurity measures can lead to expensive losses and damage an IT organization’s reputation. An information technology business insurance policy can help protect IT enterprises from those liabilities.

  • Professional Liability Insurance: Also referred to as errors and omissions (E&O) insurance, professional liability insurance protects against third-party claims arising from errors, omissions, or negligence in providing professional services. It covers legal defence costs, settlements, or judgments resulting from professional negligence claims or failure to meet client expectations.

An extensive information technology insurance policy may include the following additional coverages:

  • Cyber Liability Insurance: Cyber liability insurance protects IT companies from the financial impact of data breaches, cyber-attacks, or unauthorized access to sensitive information. It covers costs associated with breach notification, credit monitoring services, forensic investigations, legal defence, and potential liabilities resulting from third-party claims.
  • Commercial General Liability (CGL) Insurance: A fundamental coverage for any business, CGL, or general liability insurance, covers you against third-party bodily injury or property damage claims that may occur as a result of your IT company’s regular operations. For example, if a client visiting your office slips and falls and is hurt, CGL insurance can cover their medical expenses and any resulting legal claims against you.
  • Commercial Property Insurance: Commercial property insurance covers damage and loss to your office or workspace and your business contents, electronics, furnishings, and inventory because of fire, water damage, a natural disaster, theft, and vandalism.
  • Legal Expense Insurance: Also known as legal protection insurance, legal expense insurance is designed to provide financial protection for legal costs and expenses associated with various legal matters or common business issues. It gives IT firms funds for legal representation from an experienced lawyer and legal advice.

Insurance providers determine the price of an information technology business insurance policy based on several factors about your company, including:

  • Your location
  • The products and services you provide
  • The number of employees you have
  • The value of your company’s assets
  • Your years of experience, education, training, and industry certifications
  • Your annual and gross projected revenue

Getting insured is quick and easy!

Complete our 5-minute online application for a free IT professional liability insurance quote.

Common claims scenarios

software programmer

Problem: A customer-facing software system developed by your IT company for one of your clients contains errors and does not function as expected, resulting in financial losses for your client. They threaten legal action against you.

Outcome: Your professional liability insurance may cover the cost of your legal defence and any out-of-court settlement or judgments against you in court.

cyber hacker

Problem: Your IT company experiences a data breach resulting in unauthorized access to sensitive client information.

Outcome: Your cyber liability insurance may cover the costs for breach notification, forensic investigations, legal defence, and any potential liabilities arising from the incident.

extension bar fire

Problem: A fire ignites in your IT company’s office overnight, inflicting significant damage to the building, your contents, electronics, and furniture.

Outcome: Your commercial property insurance may pay to repair the damages to the building and repair or replace your contents, electronics, and furniture.

Frequently asked questions

Is information technology liability insurance mandatory for IT companies?

Information technology liability insurance requirements vary depending on your jurisdiction, industry regulations, and client contracts. While it may not be mandatory in all cases, having appropriate insurance coverage is highly recommended to protect against potential financial losses from liability claims.

Does information technology liability insurance cover claims arising from work performed by subcontractors?

Coverage for subcontractors can vary depending on your policy. Some policies may automatically extend coverage to subcontractors, or you can add them as additional insureds. Other policies may require your subcontractors to get coverage on their own. Talk to a licensed information technology insurance broker at Zensurance to understand coverage options for subcontractors.

Does information technology insurance cover retroactive liability claims?

Retroactive liability claims are typically covered under an information technology insurance policy, as long as the retroactive date specified in the policy predates the incident or claim being made. The retroactive date is usually the start date of the policy.

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Ready to start? Let’s get a quote!

Protect your IT company’s assets and reputation with a customized information technology insurance quote from Zensurance.

Complete our online application for a free information technology insurance quote. Our friendly brokers will shop our partner network of over 50 insurance providers to find the low-cost coverage you need and tailor it to suit your business’s needs.