Running a technology business in a fast-paced environment can be highly rewarding. Still, equally, when you are busy, we can often become distracted from infrastructure processes and back-office tasks.
Let’s face it, PI Insurance is hardly likely to be the topic that sets pulses racing. Nevertheless, it is a critical element in protecting your company from adversity, and it’s all too easy to keep your policy document in a file and only review it when you suffer a loss.
This is a dangerous game if insurers are not up-to-speed with your latest business activities or contracts you may find that you are not adequately covered!
Our “Health Check” series examines the common insurance areas which you may need to consider.
Professional Indemnity Insurance
PI Insurance is a vital ingredient for any IT Company, if you contract to larger firms or are on preferred supplier lists, you may well be asked to provide proof of cover as part of the procurement process.
As an expert in IT and technology, when you contract your services, you have an increased duty of care for the advice and services you provide to your clients.
Professional Indemnity for IT Consultants includes protection against claims for professional negligence or breach of duty of care.
More comprehensive indemnity policies will provide full civil liability protection which extends to cover issues such as those arising from contractual failures or disputes.
This is highly recommended for IT Consultants as many potential claims begin from a contractual failing or obligation not being met.
Typical claims from Technology Companies include:
- Breach of Contract: For example; suggested cost savings not being met on a new CRM system delivery. Failure to deliver an e-commerce website build in line with contractual requirements due to staff issues, which results in a financial loss for the client.
- Negligence: Whether it is actual negligence or a general allegation of negligence, any mistakes or professional challenges can prove costly, often resulting in fees being withheld or disputed. For example, your salesperson miscalculates the length of time it will take to refresh a company's client portal. The project consequently over-runs by three weeks. Anticipating it will be ready in time, the client had paid for a six-figure advertising campaign to promote the launch which now needs to be revised entirely.
- Breach of Copyright (Intellectual Property Infringement): The widening use of images and patented technology make IP infringement all too common. Best practice is for firms to employ a rigorous review programme which incorporates IP and Copyright sign-off process.
Public Liability Insurance
Public Liability Insurance protects your legal liability against claims for injury or damage as a result of the actions of you (or one of your employees) in the course of carrying out your work.
Chances are you visit or work from client premises in connection with your role, or you have clients or members of the public visiting your office if so, you will need Public Liability Insurance. For example:
- You are working from a laptop at a client office, and a member of staff trips over the cable.
- A client slips on ice coming up the path into your office and sprains an ankle.
Employers Liability Insurance
If you have any employees, no matter how infrequent or casual, you are required by law to purchase Employers Liability cover, this will indemnity you should an employee be injured during, or as a result of, their employment. For example:
- A coder slips on a wet toilet floor and shatters their arm
- Your receptionist falls from a step-ladder while putting up Christmas decorations
Office Insurance / Premises
If you own office premises, then you will need to cover computer equipment, contents and any fixtures and fittings.
Cover can be extended to cover portable electronic equipment such as laptops, tablets or smartphones while away from the premises.
An IT Professionals package policy will cover Professional Indemnity, office insurance and all of your key requirements including business interruption cover in respect of loss of profits or income following a claim such as a fire or theft.
Specialist policies are also available for serviced offices and home-based businesses. You may also find that your existing home insurance can be extended to cover business items at your residential address.
Motor Fleet or Business Car Insurance
If you use a car for business, it effectively becomes a tool-of-trade, and the key is making sure that your policy includes the appropriate level of business use.
If you operate two or more vehicles, you could save money by combining both vehicles onto a fleet insurance policy, this is ideal if you are looking to add further vehicles as your business expands.
TOP TIP: Don’t leave IT Equipment or Tech in your vehicle as a motor policy will not cover theft of business equipment.
Personal Accident and Sickness
If you are injured or fall ill, either job related or through another activity such as sport, you may not be able to work, and this will directly impact your income.
A Personal Accident and Sickness Policy will provide a lump sum payment for permanent illness or injuries (such as a loss of eye or limb) and a weekly benefit payment for temporary incidents (for example a broken leg following a go-kart accident).
Cyber Liability Insurance
Cyber Liability Insurance provides protection against hacking and data breach, a comprehensive suite of covers can be arranged to accommodate most exposures, including:
- Third-party liabilities following a breach of privacy or confidentiality, or transmission of a virus
- Crisis Management & PR Costs following a loss
- System and communication rectification cover – Repairing systems and reinstating data as quickly and effectively as possible can generate high cost. A Cyber Liability policy will enable you to reinstate systems as soon as possible, restoring operations and reducing business impact.
- Intellectual Property (IP) Infringement – Should you accidentally breach a third-party trademark or copyright.
- Privacy Breach and Regulatory Costs – Some data breaches can incur potential investigation costs or fines from the government or regulator. Cyber cover can extend to cover these costs and any penalties imposed.
FREE IT Consultants Insurance Review
Every Technology firm is different, and the varied nature of activities and contracts often mean that a professional indemnity insurance policy needs to be tailored to your specific requirements. As such, you may want to take advantage of our FREE Business Insurance review service.
You can book a slot that suits YOUR diary via our website, or call one of our insurance gurus on 0330 1240730.