This specialized coverage product is meant to protect against professional liability risks in this industry.
Technology errors and omissions insurance is a form of specialized coverage product offering people in the technology industry protection against professional liability risks specific to them.
This coverage can be known by many different names but is often key for those in the tech industry.
Technology errors and omissions insurance is comparable to traditional E&O policies, also frequently known as professional liability policies, or as malpractice insurance. That said, those traditional policies are usually written for service professionals such as lawyers, architects, and consultants. It protects these professionals against the legal costs that can accumulate if a client should sue due to a believed error or mistake made while performing services that led them to experience some form of loss, typically a financial one.
That said, the tech industry comes with its own specific types of risks and this form of policy was created to protect against those that most commonly occur with tech companies. As tech is one of the fastest growing industries worldwide, the need for this type of coverage – regardless of the size of the business – has grown as well.
Technology errors and omissions insurance is usually recommended for any tech business.
Risk and insurance experts will usually recommend adding this coverage to the policies right from the moment a tech business begins. Embroker tech start-up insurance packages consider that coverage to be essential for businesses in the industry.
The reason these policies are different from the standard form is that tech companies usually work in cutting-edge field. Therefore, when lawsuits happen, there isn’t always a great deal of precedent – if any. Therefore, the coverage must take into account that a modern approach must be applied in assessing liability and providing protection in less traditional or tangible areas.
As a result, it makes sense that businesses in tech may be far better served by a technology errors and omissions insurance policy than they would a more general form of E&O or professional liability coverage, which was not worded specifically to cover the type of unique risks that occur within the tech industry.