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Seattle IT Business Insurance

It's no secret that Seattle, Tacoma, Bellevue, and Redmond are big names in the tech world. As the location for Microsoft, Amazon, and an ever-expanding array of startups and mobile development companies, the Seattle area boasts a gross metro product of over $230 billion and ranks in Forbes' list of top ten cities for careers and job growth.

For the last 30 years, tech has bolstered Seattle's economy. And thanks to IT small businesses and startups like yours, the tech economy will continue to grow throughout Puget Sound.

Seattle Tech Companies: Get Important Insurance Coverage

Why buy business insurance? There are two answers: 1) some policies are required by law and 2) some policies are just common sense. Business insurance protects Seattle tech companies from lawsuits that could derail their businesses. A data breach, slip-and- fall accident, or other incident can lead to six-figure legal bills. Here are the insurance policies we most often recommend to protect tech businesses like yours:

General Liability Insurance

General Liability Insurance pays for many of the common lawsuits your tech business is exposed to, such as disputes over physical injury, advertising injury, and property damage lawsuits. This policy only covers lawsuits that are filed against your business by an outside party. For example, let's say a deliveryman slips the tile floor of your office, dislocating his shoulder. General Liability Insurance can cover the cost of a slip-and-fall lawsuit like this, which may include attorney’s fees and the deliveryman’s medical bills.

Business Owner's Policy

Many businesses purchase BOPs in order to get two important policies – General Liability Insurance (see above) and Property Insurance – at a reduced price. The two policies are bundled together for one discounted premium. Property Insurance insures the commercial property a business owns (i.e., computers, technology, office equipment, buildings, etc.) when it is damaged by a covered event, such as fire, theft, vandalism, and windstorms. For example, if a fire damages the servers at an IT company in Tacoma, Property Insurance can cover the cost to replace the damaged property.

Errors and Omissions Insurance

Just like doctors have Malpractice Insurance, tech professionals have E and O Insurance (also called “Professional Liability Insurance”). If you make a mistake, miss a deadline, or deliver work that your client doesn’t like, Errors and Omissions Insurance can cover the resulting lawsuit. E&O Insurance is extremely important for people working in IT because it covers lawsuits related to client-side data breaches. Say an IT consultant installs new sales software for a client. Who's responsible if that software causes a data breach? It turns out that the consultant can be sued. Even if you only install software (and don't write it yourself), you're still exposed data breach liability. For this reason, many client contracts require E&O coverage.

Workers' Compensation Insurance

Workers’ Compensation Insurance provides benefits to employees who suffer from occupational injuries and diseases. Most Seattle businesses are required to purchase Workers' Compensation Insurance through the Washington State Department of Labor and Industries (L&I). However, if you are a sole proprietor or your business doesn't have any employees, you can opt out of Workers' Comp coverage. If you're confused about your requirements, read L&I's Workman's Comp FAQs or call one of our agents. You can reduce your WA Workers' Comp rates by having safety plans, undergoing a WC consultation, and meeting other requirements outlined by L&I.

Cyber Liability Insurance

Cyber Liability Insurance (also called “Data Breach Insurance” or “Cyber Risk Insurance”) is necessary for some IT companies, but not others. It only covers data breaches that occur on your network (E&O covers client data breaches). Web hosts, big data analysts, and other businesses that keep client / user data on their networks need to protect their data breach liability with Cyber Liability Insurance. However, if your business doesn't keep that kind of data on its network, you probably won't need Cyber Liability Insurance. Say an e-commerce company is hacked and user data is exposed. Cyber Liability Insurance pays for the company to contact its customers about the breach and offer credit monitoring services. This insurance also covers the cost to hire extra personnel, forensic investigators, and PR experts to help you through the aftermath of a data breach.

For a free, no-strings-attached insurance quote, submit an online insurance application. If you'd rather talk with a live human being, call us at 1-800-668-7020.

Snapshot of Small IT Businesses in Seattle, Tacoma, and Bellevue

  • 77% of IT businesses in Seattle, Tacoma, and Bellevue are home businesses.
  • 28%of business owners are responsible for client data as part of their products and services.
  • An average business subcontracts 37% of its annual work to third parties.