Today companies are relying more than ever on information and network technology solutions, as a result the business landscape has changed and the legal and financial stakes are high when a technology solution fails or doesn’t perform as promised.
General liability policies typically exclude coverage for claims of financial loss when there is no bodily injury or property damage, or when negligent acts and errors or omissions occur as a result of the performance of technology professional services. At SciTech Insurance we know the difference and offer the right solutions that help protect your firm from modern day business exposures.
Data Breach Insurance
You put maximum effort into establishing and running your business. But are you taking the right steps to make sure your business can survive a data breach event? Regulatory agencies are imposing stricter responsibility on businesses to ensure the security of third party client and employee information. Unfortunately data breach incidents continue to rise at a dramatic rate, resulting in an average cost of $214 per affected customer record to U.S. companies, (The Ponemon Institute 2011).
So, how will you respond when a data breach happens to your business? You will need a lot of information and the financial necessary means to effectively respond to and to mitigate further financial damage. Having the right team in place and a responsive insurance program designed by a qualified business insurance professional can make all the difference in the world in your ability to properly handle a data breach event.
What Is The Likelihood That A Technology Company Will Be Sued?
Intellectual property has rapidly become the lifeblood of many major corporate and small businesses. What were once warehouses filled with physical widgets are now data bank centers, collocations and clouds stacked with electronic “intellectual property” data consisting of company patents, copyrights, trademarks, trade secrets, confidential and personally identifiable information.
As companies rely more on technology solutions to keep up with market competition, the pressures and stress of accountability that goes along with the delivery of products and services are also increasing. In many business relationships, companies are involving their technology partners and shifting, and sharing, the burden of accountability. Technology firms whose products either run applications or whose services are relied upon, are held at higher standards than ever before.
When a technology product fails to perform, or when intellectual property information becomes compromised and results in a financial loss, companies often may seek legal remedy. More and more, these situations turn into a finger-pointing matter that can lead into lawsuits between long-established business relationships and venture partnerships.
Any technology firm need to ask themselves some tough questions before entering into any business contract; questions such as, “What is the worst case financial scenario should my product fail or not function correctly?” Additionally, they should make sure that they have included definitive remedy agreements within the terms and conditions of contracts with their business partners and have their legal counsel review contracts prior to execution.
As with any business, risk management is a necessary consideration to technology firms, having the right type of insurance coverage can oftentimes be the difference between having a sound risk management plan or suffering a devastating financial disaster. Technology Errors & Omissions insurance responds to allegations of professional and technology wrongful acts. Additionally, a Technology Errors & Omissions insurance policy can be endorsed to include other financial exposures such as media communication liability, network security, privacy liability and data breach notification costs.
Traditional insurance policies such as a general liability insurance policy will not respond to a technology-related claim. Finding the right insurance agent who has experience with technology firms and who has the right markets to provide the appropriate solutions to technology firms is extremely important to the financial growth of a technology firm.