Technology Errors and Omissions Insurance is designed to protect technology businesses from intangible damage that they might unintentionally cause. In the event that a client seeks compensation because such circumstances have occurred, E&O insurance will pay for any defense costs or damage awards and can save a business from going bankrupt because they made a mistake.
Who Does Tech E&O Cover?
Tech E&O covers providers of technology services or providers of technology products. A technology service provider might be a website designer or a data storage company, whereas software manufacturers offer technology products.
What Does Tech E&O Cover?
Tech E&O policies cover a company’s exposure to liability and property loss claims. A technology company may be held liable if they lose or damage client data while managing a website or transferring files. A technology company can also be sued if software or hardware they developed was directly responsible for data loss or had a direct negative economic impact on a client. If media content supplied or managed by a technology company damages a client’s reputation, the technology company can also be held responsible. Finally, security breaches and identity theft can also be reasons a client may seek damages from a technology company.
Because the risk involved in insuring a web design firm differs from that of insuring a software company, not all technology Errors and Omissions insurance is created equally. It is always best to work with an insurance agent who specializes in tech E&O to protect your business from harm.