While most of the news about business in Detroit has been gloomy, the silver lining has been its resilient tech economy. Startups and IT companies have been working as hard as anyone to rebuild Michigan's Motor City and add high-quality jobs to the
Detroit area. In fact, metro Detroit ranks fifth in the country as a source of tech jobs. While there are big companies like Compuware and ProQuest, there are plenty of small businesses and startups that are working to revitalize Motown as well.
Small Business Insurance: Protecting Motor City IT Businesses
Trying to make it in the business world is hard enough without having to worry about lawsuits and other financial crises that could bankrupt your company. While IT insurance can't prevent lawsuits, it can cover the
cost of a lawsuit over a data breach, software error, injury, property damage, and more. Take a look at the policies we most often recommend to Detroit tech businesses:
Rental leases and business agreements often require Detroit businesses to have General Liability Insurance because it protects you from a host of common lawsuits. GL Insurance is sometimes called "slip-and-fall" coverage because it covers injury
lawsuits when people are hurt on your property. This insurance covers lawsuits when people outside of your business (customers, clients, deliverymen, etc.) sue you for property damage, bodily injuries, slander / libel, or copyright infringement.
(Note: employee lawsuits are covered with Workers' Compensation Insurance).
Business Owner's Policies (or BOPs) are insurance bundles, which contain General Liability (see above) and Property Insurance. When these policies are bought together, the insurance company can give low-risk small businesses lower premiums on each.
(Small tech businesses almost always qualify as “low-risk.”) Property Insurance covers many common threats to your commercial property. Fire, theft, vandalism, and some weather coverage all come in a BOP Property policy. Most policies
also come with Business Interruption Insurance, which reimburses lost income if a fire or other covered claim causes a business to shut down temporarily.
E&O Insurance (also called “Professional Liability Insurance”) covers lawsuits related to your professional responsibilities. As an IT company, you're responsible for delivering effective and secure technology. If something goes
wrong with the software or hardware you deliver, you can be sued (even if you didn't design the technology). Say a Warren mobile app
developer is sued when a Java vulnerability causes a data breach on an app he codes for a client. E&O Insurance can cover his legal expenses, paying for a data breach attorney to defend him and covering any damages he owes his client. E &
O Insurance can also protect you when a disappointed client files an unfounded claim.
Workman's Compensation Insurance (commonly called “Workman's Comp” or “Workers’ Comp”) pays for medical, legal, and other costs related to an employee’s workplace injury or disease. Say a coder develops
carpal tunnel syndrome. The employer's Worker's Comp covers her medical expenses and the partial salary owed to her. Many policies come with Employer's Liability Insurance, which covers the employer's legal bills when an employee
sues them over a work accident or illness. Michigan law requires employers to have Workers' Compensation Insurance if they employ one or more employees (for more than 35 hours for 13 weeks) or have three or more employees at any given time. Employers
that don't comply with Michigan's Workers' Comp laws can face fines and jail time, so make sure to meet your requirements.
Most IT companies won't need Cyber Liability Insurance (also called “Cyber Risk Insurance” or “Data Breach Insurance”), but it's crucial for certain areas of IT. Data mining companies, web hosting
businesses, e-commerce startups, and other ventures with financial or personal data on their networks need to protect that data with Cyber Liability coverage. This policy covers many expenses related to a data breach: credit monitoring and identity
theft prevention services, data breach investigations, and the cost to contact users affected by a breach. However, businesses that don't store many private records on their network probably don't need to purchase CL Insurance, because E
and O Insurance covers them for client-side breaches.
Call an insurance agent at 1-800-668-7020 or submit an online insurance
application and TechInsurance's IT experts will customize an insurance quote for your business.