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Information Technology Liability Insurance

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What is Information Technology Liability Insurance?

IT Liability Insurance allows Technology Companies to limit liability for third-party claims. It combines cover for:

Professional Indemnity: If your advice or service results in third-party financial loss.

General Liability: If your products or services cause third-party injury or property damage.

Technology businesses need indemnity and liability cover because they face risks associated with offering products and services. It is important for indemnity and liability to be covered together on the same policy. If you insure these risks separately, you may end up with a gap in cover.

Why do Technology Companies need specialised liability policies?

The type of liability coverage a business needs will depend on whether they provide products, services, or advice. Since a technology company typically offers a combination of products, services and advice — they need a policy that covers more than one type of liability.

The main benefit of IT Liability Insurance is that it offers all of the necessary liability coverage under one policy. When you cover indemnity and liability separately, claims can slip between the cracks. If your insurers disagree over who is responsible for a claim, you may end up covering it yourself.

➤ Claim example

You tell a client that software you are installing will not clash with their firewall. A clash happens and their system goes offline. Your client asks you to cover the cost of repair.

Your insurer could view the claim as:

A Product Liability Claim: Your product (software) damaged a third-party system.

A Service Liability Claim: Your service (installing software) damaged a third-party system.

A Professional Indemnity / Errors & Omissions Claim: A third-party suffered a financial loss (system repair expenses) as a result of your incorrect advice.

If you have insured for all three scenarios under one policy, it will not matter which your insurer picks.

If you have insured for these scenarios under different policies, then you are open to risk. If your indemnity insurer declines the claim as a liability issue, and your liability insurer declines the claim as an indemnity issue, you may be left out-of-pocket.

Have any questions?

Get in touch with our team today to discuss appropriate insurance solutions.

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Who should consider IT Liability Insurance?

Areas and activities that need IT Liability Cover include:

Hardware

Design, manufacture, assembly, installation, maintenance and resale.

Software and Apps

Development, design, configuration and resale.

Data

Warehousing, processing, hosting and analysing.

Websites

Hosting, design, plug-in building, SEO and CRO.

Development

Front-end, back-end, full-stack, dev-ops, SCALA and PLC.

Systems & Networks

ISPs, network consulting, system integration and control.

Support

IT support, training, procurement and facilities management.

Security

Security / cybersecurity management and consulting.

Telecommunications

Call centre ops, telecoms setup and consulting.

information technology liability insurance

What does IT Liability Insurance cover?

Main coverages

This section covers financial losses incurred by a third-party as a result of your service or advice. It can include claims related to your errors and omissions. It extends to both legal fees and settlement costs.

➤ Public and Product Liability

This section covers costs related to third-party injury or property damage. It includes claims that result from product malfunction and from day-to-day business activity. The cover is not limited to your business premises. It will apply for on-site work.

Typical coverage extensions

Multimedia Liability.

The actions of employees and subcontractors.

Loss of data and documents.

Defamation.

Legal breaches, including breach of copyright, IP and trade acts.

Contractual breaches, including NDAs and confidentiality clauses.

The cost of mitigating losses once they occur.

Product-recall.

Complimentary coverages

This section is for costs and losses that your business incurs as a result of cyber attacks. It is a common part of IT Liability Policies because of its particular applicability to IT providers. Covered events include malware attacks, cyber extortion and social engineering.

This section covers managers and directors for risks associated with running a technology company. This includes costs related to mismanagement allegations, legal breaches, third party crime, tax audits and identity fraud.

Ready for a Quote?

Request an Information Technology Insurance Quote Now

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Why Work With KBI?

At KBI, we have leveraged our networks, strong relationships and our insurance/risk management knowledge of the Technology sector to customise insurance solutions specific to each firm’s needs. We provide expert advice to make the process seamless and help our clients better understand their insurance program – helping them make an informed decision.

Information Technology Liability Team

nick george
Executive Broking Manager
travis kenzle kbi
Managing Director
tyler speers kbi
Account Manager
Zakiyya Dessay
Associate Account Manager

Contact Info

Street Address:

Level 18, 140 St. Georges Terrace, Perth, WA, 6000

Postal Address:

PO Box Z5102, St. Georges Terrace, Perth WA 6831

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