Web Developer Insurance

A client's business can succeed or fail depending on its website, so the right coverage is essential for web developers. For example, if an e-commerce business hires you to revamp their website, but then claims you didn't finish the job adequately and they lost customers because of it, they could sue your business.

Errors and omissions insurance, also called professional liability insurance, protects against legal costs related to claims of professional negligence. It's often required in contracts, as it protects clients from potential losses arising from your services.

Web devs and other software developers often bundle E&O with third-party cyber insurance into a package called tech E&O. This package protects against lawsuits arising from cybersecurity failures that affect clients.

For example, if you get sued over a data breach because a client's website still has default security settings and passwords, your tech E&O coverage would help cover damages or lawsuits.

Web devs also need cyber insurance, or data breach insurance, to cover data breaches for your business. Small businesses are often targeted by cyber criminals because of their limited defenses. Cyber insurance helps pay for investigations, ransomware attacks, and notification costs that can add up quickly.

Professional liability insurance, also called errors and omissions insurance, protects your business against lawsuits and claims arising from professional services. While professional liability isn't always required by law, client contracts often require coverage. This policy is sometimes also referred to as software liability insurance for tech companies.

Web development agencies often create websites, copy, and other materials for businesses. These tasks can lead to disputes if a client sues, claiming your work caused financial harm or costly delays.

Compared to standard professional liability insurance policies in other professions, media liability insurance is often tailored to include intellectual property (IP) coverage, which is especially relevant for web design professionals who create websites.

However, it generally won't cover things like purposeful wrongdoing, illegal practices, or KPI guarantees, such as promising specific ROI.

Many web devs also elect to carry tech professional liability insurance, a popular bundle that combines professional liability coverage and third-party cyber insurance at a lower cost than buying the policies separately. This combined bundle is sometimes also called technology errors and omissions insurance, or tech E&O.

This coverage can help pay for legal defense costs, data breach lawsuits, settlements, and judgments. These are expenses that could otherwise be difficult for a small agency to absorb.

Yes, freelance web developers and independent contractors need business insurance. Self-employed web developers still take on many of the same risks as large businesses. However, they have fewer assets to cover the costs of a lawsuit or an injury.

Without insurance, you may have to cover expensive lawsuits, legal fees, and damages out of your own pocket, which can financially devastate your single-person business. In addition, your clients may require you to carry certain policies, such as general liability, tech E&O, or a fidelity bond, to secure a contract, even if you work from home. This ensures they're financially protected against losses related to your web dev services.

For example, you are hired by a nonprofit to work as a 1099 contractor for a project. During the course of your work, you experience personal issues and fail to communicate them, causing you to fall significantly behind schedule and go over budget. If they decide to sue over the time and money lost, you could be liable for the expenses and would have to pay out of pocket without insurance coverage.

Professional liability insurance is often among the most recommended policies for single-person web dev businesses, as an error in judgment, a missed deadline, a mistake, or an accusation of negligence can be financially devastating and lead to costly, time-consuming litigation.

A tech E&O policy combines professional liability and cyber liability insurance to protect your single-person business from many of the most common risks in the website development field. For example, this policy would cover data breach lawsuits for freelancers who handle personal data for their clients.

You may need other insurance policies or a bond to sign a commercial lease, qualify for a loan, or fulfill the terms of a contract. For example, many independent contractors are required to carry general liability insurance to obtain a business loan or sign a lease.

While it's not required by law for most sole proprietors, workers' comp covers expenses related to work-related bodily injuries and lost wages from recovery that your personal health insurance won't cover.

If you use your own car for business purposes, a hired and non-owned auto insurance (HNOA) policy is a must. You'll need this coverage to supplement personal auto insurance, which won't cover driving for work purposes beyond a commute.

Additionally, contractors often buy business insurance because homeowner's insurance and other personal policies don't cover incidents related to their work.