SunGate Insurance Agency Blog
Insurance for technology errors and omissions is a new line of coverage. It is used whenever a technology service or product fails. Most companies, especially startups, should consider technology errors and omissions insurance as a standard product liability insurance policy may not be enough.
In the world of insurance, firmware, software, and other code can be considered outside the coverage of many standard insurance policies. What they create and deploy for customers are not considered a product. The absence of protection can put them under the product liability policy. Thus, technology companies should have insurance coverage that can cover code failure. It is not like how doctors or attorneys use malpractice insurance. This insurance covers the services that they provide.
Technology E&O Insurance
Whenever you sell software to a customer, you highlight the application's benefits. Most of the time, savings, increased efficiency and extra sales are the advantages. The customer perceives that they will pay you money. Then, they can experience the benefits of your software.
What will happen if your software or code produces a negative value to your customer? What will occur if the application has an error or bug that increases the costs and loses sales?
In these situations, consumers may sue your company because of your service failures. It can lead to damages. Your policy in technology errors and omissions insurance will respond. It can protect your business, assets, and employees. It will pay for the costs that associate with defenses. It also pays for investigations and settlement costs. There may also be times when someone sues your business even if it did not cause the damage. Most of the time, the policy will respond in the same way.
The systems act like an attorney who removed evidence that may help win the case. It may be a doctor who did not realize the prescription drugs' compatibility issues. These people are professionals in their field. They are at a high standard whenever they deliver their services. Your business that develops and sells software has the same legal standard.
At the Sungate Insurance Services, we take pride in making sure our commercial clients are well protected from the unique risks their businesses face at prices they can afford. To learn more about how we can help you, please contact our agency at (407) 878-7979 or Click Here to request a free quote.