Data Center Business Insurance
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6 insurance policies every data center should consider
Data center insurance policies help your company comply with state laws and the terms of leases and contracts. These policies can aid with natural disaster recovery, legal issues, theft, and data breaches.
Technology errors and omissions insurance
Tech E&O insurance covers legal costs related to work performance, such as a mistake made by a data center operator that causes a disruption or data loss. It includes both E&O and cyber insurance.
- Outages and downtime
- Breach of service level agreement
- Legal costs from a client's data breach
Cyber insurance
This policy helps your data center recover from a data breach or cyberattack. It's strongly recommended for any business that stores credit card numbers, customer addresses, or other personal information.
- Fraud detection and monitoring services
- Client notifications after a data breach
- Business interruptions from cyberattacks
Fidelity bonds
If one of your employees steals from a client, a fidelity bond reimburses the client for the amount that was stolen. It’s often required by clients in financial services.
- Unlawful data access by your employee
- Illegal money transfer by your employee
- Other employee theft or fraud
General liability insurance
This policy protects data centers from basic third-party risks, and it's often required by contracts and leases. Bundle it with property insurance in a business owner's policy (BOP) for a discount.
- Accidental client injuries at your office
- Accidental damage to client property
- Libel, defamation, and copyright lawsuits
Workers' comp insurance
Data centers and service providers that employ other people usually need to purchase this policy to comply with state law. It covers medical expenses for employees injured on the job.
- Medical bills from work-related injuries
- Disability benefits while employees recover
- Workplace injury lawsuits
Commercial auto insurance
Commercial auto insurance covers the cost of accidents involving a data center's truck, van, or company car. Most states require this insurance coverage for vehicles owned by a business.
- Auto accident injuries
- Property damaged by your vehicle
- Legal costs from accidents
How much does insurance cost for technology businesses?
Average costs come directly from policies purchased by TechInsurance customers.
General liability: $30 per month
Errors and omissions: $67 per month
View more expected costs.
Start a free application to see how much insurance will cost for your business.
Why data center owners choose TechInsurance
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Common questions about business insurance for data centers
What other business insurance policies should data centers purchase?
Data centers may need additional insurance policies to protect against other exposures:
- Business owner's policy: A BOP bundles general liability coverage with commercial property insurance to protect against common lawsuits and business property damage. It's often required for client contracts and commercial leases.
- Business interruption insurance: This policy helps your data center recover financially from a temporary closure tied to a fire, storm, or other covered property claim. It's often included in your property insurance or BOP.
- Employment practices liability insurance (EPLI): This type of insurance covers lawsuits related to violations of an employee's rights, such as wrongful termination or discrimination.
What's the difference between first-party and third-party cyber insurance?
There are two kinds of cyber insurance, both equally important for data centers:
- First-party cyber insurance protects against data breaches and cyberattacks that affect your data center directly, such as a DDoS attack that overwhelms your network.
- Third-party cyber insurance helps pay for legal costs when a client blames your data center for failing to prevent a data breach or cyberattack at their business. For example, a vulnerability in managed services that your clients depend on could expose information belonging to their customers.
When you buy tech E&O, it includes both types of cyber insurance, along with errors and omissions insurance to protect against other lawsuits from dissatisfied clients.
How can you save money on business insurance for data centers?
It's easy to save money on business insurance through a few simple steps:
- Shop around. Get quotes from several insurance companies to find pricing that matches your budget. TechInsurance makes this possible with one easy online application.
- Bundle policies. When you buy policies from the same provider, it's often possible to combine coverages for a discount. The most common bundles are a business owner's policy and tech E&O.
- Pay the annual premium. Insurers offer two options when it comes to paying your premium: monthly or annual payments. Paying the full annual amount usually costs less.
- Risk management. Avoid costly claims that can increase your premiums by reducing your risks. Eliminate clutter that could cause accidents, use detailed written contracts, and include redundancy in your systems.