What Are Computer Consultants, and Why Do They Need Technology Errors and Omissions Insurance?
Dan Levenson December 08, 2021
Today, many businesses rely heavily on technology to drive day-to-day operations. While innovation has made many of our procedures more streamlined, technology failures and security breaches are growing areas of concern.
Technology failures and security breaches cause substantial financial burdens, and businesses may look to hold technology providers who are designing and maintaining their systems responsibly. Unfortunately, traditional liability policies do not cover such losses, which is why we provide Technology Errors and Omissions Insurance.
Sometimes called Professional Liability Insurance, Technology Errors, and Omissions Insurance offers protection for mistakes your company makes in the course of providing computer consulting services.
What are Computer Consultants?
Computer consultants are IT professionals with proven experience in specific areas of Information Technology. They handle the hardware, configuration, and programming of tech solutions.
Computer consultants may also propose computer hardware, technology, or software that matches clients’ needs. Even with top-notch programmers on your side, mistakes do happen which can result in data breaches or system failures.
Why Computer Consultants Need Technology Errors and Omissions Insurance
Weathering a cyber event can be expensive. Small businesses spend an average of $995,430 to stabilize after an attack. If a security breach is due to an error by your IT consulting firm, you might be responsible for the loss. Investing in the right insurance policy could help them evade the burden.
In addition, many small businesses are not equipped to properly handle a data breach. That means outside consultants must be brought in at a substantial cost. The right insurance product can help offset the expense associated with cleaning after a covered cyber security event.
Even if your and your company did nothing wrong, a client can still bring a claim against you for negligence if they suffer a security breach. Errors and Omissions insurance can help pay for the defense of a claim, even if it is baseless.
It is Often Required by Contract
Most customers require that computer consultants have Tech E&O Insurance because of the risks discussed above. It assures potential customers that there is a financial backstop if something goes wrong. In most cases, your Certificate of Insurance will be proof of coverage.