E&O Insurance

E&O Insurance, or Errors and Omissions insurance, applies to cases in which litigation is applied due to the negligence of performing professional duties. In the case of Information Technology (IT) or Tech companies, E&O insurance can protect the company from charges which might occur that are not the company's fault, such as hardware or software failures. E&O insurance is especially good to have in an age when Internet servers fail, computer viruses run rampant, and hard drives get unexpectedly erased.

Since most contemporary companies rely on online business, the failure of a partner Tech company is not tolerated. Especially when these customers of Tech Companies demand more for their money, and where 99.9% is not good enough. In an age when clients can file massive lawsuits that can result in high payouts and ruined reputation, E&O insurance agents will defend your claim and provide within the limits of your policy. Tech companies should keep in mind that there is a limit to E&O insurance, and one thing it does not cover is deliberate negligence. This is why it is important for companies to keep excellent records, so they will not be held accountable for more than they should. Tech companies should also remember to follow the first rule of any insurance when buying an E&O policy: go over it meticulously to see what it does and does not cover.

It is also highly recommended that a Tech company have their E&O insurance in place the day their site is launched. Unfortunately, most Commercial Liability Insurances do not figure in for catastrophic technical cases that fall under the category of E&O insurance work. Tech Companies have enough to do without receiving the burden, both legal and financial, that stems from lawsuits from companies and clients who claim that they failed because of the tech company.