Forbes Magazine recently named San Diego one of the top three cities for tech job growth. While northern California may get more press, it turns out that North County and San Diego have quickly become major players in the tech world.
All burgeoning tech businesses need a solid small business insurance plan to help protect their investments. Read on to learn more about the policies that can benefit your IT business in America’s Finest City.
Small Business Insurance Protects San Diego Tech Businesses
Small businesses are a key part of the San Diego-Carlsbad-San Marcos area’s tech growth, and a key part of managing your startup, consulting firm,
or other IT company is protecting it from unexpected costs. Small business insurance shields you from the costs of lawsuits, property damage, and workplace accidents. To protect your tech business, you'll need a combination of policies. Here
are a few that we commonly recommend to IT professionals:
General Liability Insurance covers lawsuits related to bodily injuries, non-physical injuries (such as copyright infringement), and property damage. GL Insurance only covers lawsuits that are filed against your business by “third parties,”
a legal term for people not employed by you. This includes clients, customers, deliverymen, and contractors. For example, if your company damages a client's property, General Liability Insurance can cover your lawyer's fees, settlements,
and judgments, should that client decide to sue.
Business Owner's Policies package two important insurance policies together to offer small businesses coverage at a lower price. A BOP insurance bundle includes General Liability Insurance (see above) and Commercial Property Insurance, which insures
a business's equipment, technology, and other property. When you have Property Insurance, your insurance company can cover the cost of replacing and repairing property that's been damaged in a fire, stolen, vandalized, or destroyed by covered
weather events. Each property insurance policy will list what weather events are covered. Generally speaking, floods and other major storms are not automatically covered by Property Insurance.
Errors and Omissions Insurance (also called Professional Liability Insurance) can pay for your legal protection if you're sued over IT consulting, software development, or other tech work. An E&O lawsuit is a dispute over your professional responsibilities.
Clients can allege you delivered work late, failed to fulfill an obligation, misinterpreted what they needed, or delivered shoddy work. Lawsuits over software flaws, failed web marketing campaigns, poor performing hardware and software are all covered
under an E and O policy. This policy also covers lawsuits over third-party data breaches – the kind that happens when a client's network is hacked, infected with malware, or suffers other kinds of data loss.
California requires employers to purchase Workers' Compensation Insurance (also called “Workman's Comp” or “Workers' Comp”) to cover employees who are injured on the job. Workers' Comp pays for an employee's
medical expenses and lost income after a workplace accident. In addition, most policies come with Employer's Liability Insurance, which shields employers from the cost of a Workers' Comp lawsuit. The state of California does allow some exceptions
to its Workers' Comp requirements. Micro businesses, sole proprietors, and businesses that don't have any employees are usually not required to purchase this insurance.
Most IT companies only need to purchase E&O Insurance to cover their data breach liabilities. However, some also purchase Cyber Liability Insurance (aka “Data Breach Insurance” or “Cyber Risk Insurance”). Remember: E&O
only covers third-party data breaches (the ones on client computers). CL Insurance covers first-party data breaches, the ones that happen on your own network. If your company is hacked or accidentally exposes its data, Cyber Liability Insurance
will cover the cost to monitor your customers’ credit (in order to prevent identity theft), new advertising and marketing efforts, and other aspects of your data breach response.
For a free, customized IT insurance quote, contact a TechInsurance agent at 1-800-668-7020 or submit an online insurance application.