Errors & Omissions

What Is Professional Liability Insurance?

And why it’s important

A professional is someone whose vocation or occupation requires special training and skill. Historically, lawyers, accountants, architects, engineers, and medical professionals were the sole occupations that fell into this category as their industries established strict regulation requirements and codes of conduct. In order to practice in these fields, it was necessary to undergo formal training and pass a state licensing exam to be provided with credentials. The first Professional Liability Insurance policies, also known as Errors and Omissions coverage, were devoted exclusively to this elite group.

Gradually, other types of professionals requiring Professional Liability Insurance (Errors and Omissions Insurance) such as real estate agents, business consultants, social services counselors, educators, and computer technology professionals, began to emerge. While these other classes are often referred to as quasi-professionals under the eyes of the law, they have already developed their own industry regulations for education, testing, and accreditation.

Protection for current classes of professionals

Miscellaneous Professional Liability insurance  policies have been developed to address many of the litigation concerns of these new classes of professionals, including computer information technology professionals.

Professional Liability  insurance provides protection against certain types of lawsuits arising out of negligent acts, errors, or omissions committed during business activities and that result primarily in economic damages that are not related to bodily injury, property damage, personal injury, or advertising injury.

Why Professional Liability insurance is important

It is important to understand that a Professional Liability insurance policy is meant to dovetail with a General Liability policy. The General Liability policy covers lawsuits alleging bodily injury, property damage, personal injury, and advertising injury. As a result, these types of injuries are not covered by a Professional Liability insurance policy.

Professional Liability insurance is important because it fills a glaring gap in the General Liability policy, which has a professional services exclusion that takes away coverage for lawsuits resulting from services rendered or failure to render professional services. Professional Liability insurance policies are meant to respond to lawsuits alleging only economic damages where the client has lost money as a result of a negligent act, error, or omission in the performance of the professional services.The definition of Errors and Omissions insurance can vary per policy form.

A good Professional Liability insurance policy is necessary to safeguard the assets of any company that provides professional services.

 

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Categories: Errors & Ommissions, Professional Liability, Reports, Tech Articles and Information, Technology
Small business insurance

Small Business Technology Insurance

 Affordable solutions for small business owners

Insurance for Techs understands the importance of proper coverage for your business. As a leading technology insurance company, we know that small businesses are experiencing an ever-increasing capacity for work. As a result, you also have a greater likelihood for technology errors and omissions liability. When it comes to protecting your business, you need an insurance plan that meets your needs.

Insurance for Techs is a technology insurance company that responds to the changing business environment. We know how to efficiently and appropriately quote technology Errors and Omissions Liability insurance. With Insurance for Techs, you get more than technology insurance – you get a protection plan that includes essential risk management advice.

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Categories: Errors & Ommissions, Small Business, Tech Insurance, Technology

Tech Company Advertising Injury Coverage

Why it’s necessary

The standard General Liability policy covers personal injury and advertising injury unless the insured is in the business of advertising, broadcasting, publishing, or telecasting. For this reason, there is no coverage for IT firms that are in the business of designing websites, determining content, providing content, or providing internet access.

Advertising InjuryWhy do tech firms need personal injury coverage? Coverage may be needed to against an allegation of slander, libel, or oral or written publication that violates a person’s right of privacy. It is not too difficult to see how a tech firm could get sued under these circumstances. Coverage may also be needed for advertisement injury to protect against allegation of infringement of copyright, trade dress, or slogan in your advertisement. The key word is advertisement. There is no coverage for infringement of copyright, trade mark, trade dress, or slogan unless they occur in an advertisement.

What’s not covered

An exclusion in the policy form eliminates coverage for injury arising out of electronic chat rooms or bulletin boards that the insured hosts, owns, or exercises control over. In addition, there is an exclusion arising out of the unauthorized use of another’s name or product in your email address, domain name, meta tag, or similar tactic used to mislead the someone else’s potential customers.

It is obvious that the standard General Liability form does not adequately protect tech companies or IT professionals against these important exposures. As a result, coverage can be sought as part of a Professional Liability or Errors & Omissions policy form. These policies can add essential coverages for tech firms in the business of advertising or publishing and violation of a person’s right of privacy or undue publicity, intellectual property infringements, etc.

It is strongly recommended that tech companies or IT professionals deal with a tech insurance specialist to make sure that their coverage needs are addressed.

 

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Categories: Advertising Injury, Errors & Ommissions, Personal / Advertising Injury, Professional Liability, Technology

Data Breaches Growing Rapidly

Tech Companies Uninsured

Over the past several years, there have been over 225 million reported consumer data breaches. This year alone, there have been more than 30 million reported security breaches of consumer data. No one knows the actual numbers since it is suspected that most security breaches are unreported.

Most tech firms and regular businesses with exposure don’t have insurance to cover this expensive peril. Liability for the following categories of expenses are common in these breaches of security:

  • Class action lawsuits
  • Regulatory fines, fees, penalties
  • Statutory notification expenses

Tech companies that collect confidential information or assist clients in doing so must make sure that their Professional Liability/Errors & Omissions policy is specially endorsed to respond to breach of security lawsuits. Non tech companies with exposure must make sure that their Cyber Liability policy does the same.

Source: S.H. Smith & Company, Inc. E Bulletin, 10-19-08

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Categories: Breach Of Security, Errors & Ommissions, Professional Liability, Tech Insurance

An Internet Company’s Insurance Needs

The protection Professional Liability (Errors and Omissions Liability) insurance provides

Internet companies that provide website design, hosting and other services need Professional Liability insurance, also known as Errors and Omissions Liability,. This coverage protects against the growing number of lawsuits that are arising out of alleged failures of their technology products and services. Internet Liability insurance, which is yet another name for Professional Liability insurance, is a safeguard to protect Internet business owners.

The number of Internet companies providing website design and hosting services has increased exponentially in the past few years, making Internet liability insurance an increasingly important coverage to have. Due to the unique exposures of these Internet companies, a good Professional Liability insurance program should provide specialized coverage for intellectual property violations such as copyright and trademark infringement in addition to computer virus attacks. These risks must be taken into account by website designers and hosting companies when they select their Professional Liability insurance carrier.

Contact us with your questions about Professional Liability (Errors and Omissions Liability) insurance or to receive a quote tailored to your company’s needs.

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Categories: Errors & Ommissions, Professional Liability, Reports

Computer Consultant Insurance Needs

The number of computer consultants in the job market and the need for affordable professional liability (errors and omissions liability) insurance for computer consultants has mushroomed with the technology explosion.

Computer consultants are vulnerable to the types of lawsuits that are covered by Professional Liability (Errors and Omissions Liability) insurance. The failure of their technology services and products to perform can result in lawsuits for negligence and breach of warranty. Professional liability insurance covers computer consultants commonly named in lawsuits alleging that their negligent acts, errors, and omissions have resulted in economic damages to their clients when the technology products and services fail. Computer consultants who bear these risks out of their business or personal assets face unacceptable risks. A good Professional Liability (Errors and Omissions Liability) insurance policy can provide computer consultants with peace of mind.

General Liability Insurance

In addition to Professional Liability insurance, computer consultants should also have a good General Liability Insurance policy to protect their business.

Find out how much Professional Liability (Errors and Omissions Liability) Insurance for information technology companies can cost for you.

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Categories: Errors & Ommissions, General Liability, Professional Liability, Reports, Tech Articles and Information