Understanding the risks to your business
Information technology companies have unique Professional Liability (or Errors and Omissions Liability) coverage needs. Most IT companies such as computer consultants, software designers, intranet designers, web site developers, and computer programmers sell technology products and services that are used by their clients in the running of their businesses.
Technology insurance, such as computer consultant insurance or software developer insurance, is needed when a failure of hardware or software products or services provided to clients can result in critical mistakes being made. Such errors can result in lost income and litigation, as well as business failure. Professional Liability insurancecan protect software and hardware products and services that often control key business functions such as office automation, database management, word processing, intranets, accounting and billing, e-commerce, websites, production equipment, etc.
Protection from other risks
Information technology companies also face unique lawsuit exposures for intellectual property violations. Technology insurance, such as software developer insurance or computer consultant insurance, can protect from special personal injury issues involving privacy issues and computer virus attacks. Many of the miscellaneous policy forms may not be suitable to protect against these unique exposures to lawsuits. As a result, the better insurance carriers offer customized policy forms to provide for these specialized Professional Liability insurance exposures.
Due to the litigation risks cited above, a Professional Liability or Errors and Omissions Liability policy offers the most important protection for information technology professionals as their biggest risk exposure is the resulting economic damages from their negligent acts, errors, and omissions arising from the sale of their technology products and services.