Owning a technology company comes with unique risks. For example, your organization may collect a lot of personal information. In that situation, cyber liability would be vital to your company. This type of coverage helps tech and software businesses survive data breaches and cyberattacks. It can pay recovery costs for your business, or legal costs if a client sues over a breach. Even more importantly, E&O insurance, sometimes called professional liability insurance, is a must-have for technology and software professionals. It can cover legal fees of lawsuits related to work performance. Like other businesses, you also must consider general liability, property protection, and worker’s compensation coverage. When you come to Keslar Insurance for a quote, we will talk about all of these policies PLUS things like business interruption coverage, employment practices liability insurance, and directors and officers insurance to make sure you and your company are properly covered.
What are the insurance policies we recommend for Technology Companies?
Business Owner’s Policy (BOP)
Worker’s Compensation
General Liability
Commercial Auto
Property Insurance
Errors & Omissions Insurance (E&O)
Employment Practices Liability (EPLI)
Commercial Umbrella
Cyber Liability
Tech Company Insurance – FAQs
1. What types of insurance do tech companies need?
Most technology companies should consider a combination of:
- General Liability
- Professional Liability (E&O)
- Cyber Liability
- Technology Errors & Omissions
- Business Property / Equipment Insurance
- Optional: Employment Practices Liability (EPLI), Directors & Officers (D&O), Intellectual Property coverage, and Workers’ Compensation
2. Why do tech companies need Errors & Omissions (E&O) insurance?
E&O protects your business if a client claims that your software, services, or recommendations caused them financial harm—even if there was no data breach or physical damage. If your code fails, your advice is wrong, or your system integration causes a loss, you could be sued.
3. Is Cyber Liability still necessary if we already have firewalls and IT security?
Yes. Firewalls and software are important, but they don’t protect you from legal, reputational, or financial fallout after an attack. Cyber Liability covers breach response, notification costs, legal defense, ransomware payments, and more.
4. What’s the difference between Tech E&O and Cyber Liability?
- Tech E&O protects you from liability related to your work, like flawed software, missed deadlines, or bad implementation.
- Cyber Liability protects your business from external attacks or breaches, such as stolen data or ransomware.
Most tech firms need both.
5. Do SaaS companies need different insurance than hardware or IT firms?
Yes. Your risk profile depends on what you do. SaaS companies need robust E&O and Cyber Liability. Hardware companies may need more Product Liability. IT consultants need strong General Liability and Professional Liability. We tailor coverage to your model.
6. What if we store customer data in the cloud—are we liable for a breach?
Yes. Even if a breach happens through a third-party platform, your company can still be held responsible for data security. Cyber Liability can help you respond to the breach, notify affected users, and handle legal fallout.
7. Do tech startups need insurance right away, even pre-revenue?
Yes. Startups often sign contracts, demo products, or store sensitive data before making money. If you’re fundraising, hiring, or engaging with customers, you need insurance now, not later. Plus, many investors and partners require it.
8. What is IP (Intellectual Property) insurance and do we need it?
If you develop proprietary technology or software, IP insurance can protect you from infringement lawsuits—whether you’re accused of violating someone else’s rights or you need to enforce your own. It’s especially relevant for high-growth startups.
9. Do remote tech teams affect our insurance needs?
They can. If your team is distributed across states or countries, you’ll want to ensure your Workers’ Compensation, Cyber, and Liability policies reflect your true footprint. Some states may have specific requirements for remote workers.
10. What if we outsource development or support—are we still liable?
Yes. Even if a third-party vendor makes a mistake, you can be held responsible by your customer. Contracts help, but insurance is your safety net. Make sure your E&O policy covers outsourced services or subcontractors.
11. What insurance is required to work with large enterprises or government contracts?
Many corporate and government clients require:
- $1M+ General Liability
- Tech E&O
- Cyber Liability
- Additional insured status
Working with an agency that understands contract compliance (like we do) can help you meet these requirements without overpaying.
12. What does EPLI cover, and is it relevant to small tech teams?
Employment Practices Liability Insurance protects you from claims like wrongful termination, discrimination, harassment, or retaliation. It’s relevant for any tech company with employees—especially startups growing quickly or hiring remotely.
13. How can tech companies manage insurance costs without missing key protections?
- Bundle Cyber + E&O with a tech-specialty carrier
- Review contracts to ensure you only carry what’s required
- Maintain strong internal controls (cyber hygiene, contracts, documentation)
Partner with a knowledgeable agent who understands the tech space and can place you with carriers who specialize in your risks
