Small Business Insurance Policies for Tech Pros
At Insureon, our agents are trained to help small IT business owners manage their unique risks. Whether you operate from an office or your home (almost 75 percent of our IT customers are home-based), we know that your time is better spent serving your clients than researching and comparing insurance coverages. That’s why we’re here to help you find policies that fit your needs.
But if you want to learn a little more about the kinds of insurance we offer, take a look below. Based on our experience, we typically recommend that IT professionals consider…
Let's take a brief look at some of the most important insurance policies for technology businesses.
General Liability Insurance
General Liability Insurance is the bread and butter of commercial coverage. This policy can provide coverage when your business is accused of:
- Third-party bodily injuries.
- Property damage.
- Advertising injuries (e.g., copyright infringement, a notable risk for website developers).
General Liability coverage may pay for the costs of defending your tech business in court, including attorney fees and settlement or judgment expenses, up to the policy limits if the claim is covered.
If you rent or own commercial office space, you may need this coverage in order to sign a lease or open your business to the public. The good news is that you may be eligible for a Business Owner's Policy (BOP) if your IT firm's risk profile is low enough (and you meet certain other criteria). A BOP bundles General Liability and Property Insurance into one package, usually at a discounted rate.
Technology Errors and Omissions Insurance / Professional Liability Insurance
The specialized nature of your work and the uncertainty of evolving tech means a client may blame you if…
- They suffer a data breach because of their outdated tech.
- They think you shorted them on services because they don't understand what your work entails.
- Their server crashes and wipes out their data.
If these events lead to lawsuits, you'll be glad to have an Errors & Omissions Insurance (i.e., Professional Liability Insurance) policy on hand. It can help pay for legal expenses when you're accused of professional negligence, breaching a contract, or other errors in your work.
Technology E&O may also cover claims of intellectual property infringement, specifically concerning software, systems, or processes that you use. This coverage may vary from policy to policy, so talk to your Insureon agent about how your E&O Insurance addresses your software liability.
To reduce some of your tech business's E&O risks, be sure to always use client contracts that clearly define the scope of your work. If you work in IT consulting, train your clients on how to reduce their risk of data breaches, which in turn reduces your risk of getting sued over security events.
Workers’ Compensation Insurance for IT Businesses
If you have any employees, your state likely requires you to carry Workers' Compensation Insurance.
A typical Workers' Compensation policy can provide coverage when your employees are injured at work. It may help pay for:
- Medical expenses.
- Replacement wages / disability benefits.
- Death benefits.
- Legal expenses if your business is sued over the accident.
Though work injuries may seem improbable in an office setting, they aren't impossible. Keep walkways clear of obstructions and cords to further reduce the risk of workplace accidents.
Commercial Property Insurance
After a major disaster or burglary, the last thing you'll want to do is drain your bank account paying to replace all your lost gear and rebuild your damaged office space. And that's why there's a little thing called Commercial Property Insurance.
This policy can help pay for repair and replacement costs when your insured assets are lost or damaged because of:
When you shop for tech Property Insurance, ask your agent whether to insure your gear at its current-cash value or its replacement value. The former may cost less, but the latter may offer a higher payout for a covered claim.
Umbrella Liability Insurance
Umbrella Liability Insurance (i.e., Excess Liability Insurance) supplements certain liability insurance policies when their limit has been reached. For example, say you owe $1.5 million on a General Liability claim, but your policy can only covers $1 million. Your can apply your Umbrella coverage toward the claim to pay off the remaining $500,000.
The nice thing about Umbrella Insurance is that it can offer millions in extra coverage at a reasonable price point. Rather than bumping up the limits of your applicable policies, you can purchase an Umbrella Insurance policy instead.
However, it's important to note that Umbrella Insurance can't be applied to Errors and Omissions Insurance.