E&O Further Reading
How Client Technology Use Affects Your E&O Risk

More technology, more E&O risk — that's what it comes down to. With more devices, your clients could be facing more risks for:

  • Data breaches and security incidents.
  • Malware attacks.
  • Compatibility problems.
  • BYOD liability.

Of course, that's just a brief list.

Why are we talking about this? Say an IT consultant recommends software like Slack that lets a client's staff communicate across channels. If the consultant doesn't train the client's team how to use this software securely, a security incident or data breach could mean a potential liability exposure.

When Client Employees Take IT in Their Own Hands

When Client Employees Take IT in Their Own Hands

Your client's employees have backpacks full of devices — and you can be liable for security and usability problems that spring up when you're trying to make them all work together. You can even be liable for mistakes clients make.

What mistakes might these employees make that could lead to an E&O risk for you? They might…

  • Share sensitive information in non-secure channels.
  • Save data on non-secure devices.
  • Use open Wi-Fi.
  • Commit other data security faux pas.

These aren't theoretical risks. They're real.

In "Healthcare Employees Using 15x More Cloud Services than IT Suspect," we reported how common it is for employees to use non-approved software and cloud services as part of their job. With the proliferation of devices, this non-approved IT (or shadow IT) can be impossible to control and could expose you more E&O lawsuits.

There's another downside to the climbing number of devices clients use to do their jobs. It's simply more to keep track of, more to handle. An increasing number of programs require users to register and login, and that makes users less likely to use strong passwords for every single device. Weak passwords and security creates more opportunities for security lapses, spelling big trouble for IT consultants.

Why You Can Face Lawsuits for a Client's Blunders

Why You Can Face Lawsuits for a Client's Blunders

You might have been thinking, 'I can't be blamed for my client's data security blunders, can I?' In some ways, it doesn't matter if you did anything wrong; if clients think they've got a chance to win a lawsuit against you, many lawyers will simply advise their clients to go for it.

If your client's business faces tech problems, it'll be costly. Between repairs, security concerns, and lost productivity, your clients to rack up quite a bill. This is especially true for data security incidents.

As we reported in "Oops! Employee Mistakes the Most Damaging Information Security Lapses," a survey found that 60 percent of IT professionals cite user errors as the most damaging to their organization. When that bill comes due, a client may file a lawsuit against you, claiming you should have done a better job fitting an IT solution to their needs.

Covering Tech Lawsuits with Errors and Omissions Insurance

Covering Tech Lawsuits with Errors and Omissions Insurance

Technology Errors and Omissions Insurance (also called Professional Liability Insurance) may offer coverage when a client accuses you of professional mistakes. E&O may pay for lawsuits over:

  • Client data security incidents.
  • Missed deadlines.
  • Integration problems.
  • Data loss.
  • Usability, compatibility, and other productivity issues.

Errors and Omissions Insurance can help protect you from these costly tech lawsuits. If you're sued, E&O Insurance may pay for your court costs, attorney fees, and other lawsuit-related expenses.

Organizations are facing challenges securing devices across many platforms, so E&O will continue to be a key part of your IT risk management.

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