There are nuances to setting up the right IT Consultant Insurance program, specifically addressing the differences between IT consulting and computer programming.
Confusing the two can lead to major cost differences (with IT Consultants overpaying for coverage they don't need) and gaps in coverage.
At its core is the difference between IT Consultant's Professional Liability Insurance and computer programming errors & omissions.
Watch the video below or continue reading to understand the full story...
Need Business Insurance?
IT Consultant Insurance
Regarding IT consulting, I want to be very clear, There is a huge difference between computer programming and building software and software-related products and IT consulting.
We're going to talk about IT consulting, cabling, networking, setting up computers, and doing that kind of work today.
There may be some security work in there, but that's something that you want to talk to whoever's doing your insurance, and if it's us, we'll talk through that with you.
For IT Consulting Insurance, there are three main coverages that you want to think about:
General Liability Insurance
General liability insurance should come from a Business Owner's Policy or a BOP.
That will have your general liability insurance, your property, and a whole package of other coverages that will protect you if something happens inside that basket of coverages.
But it's a lot of little stuff you don't think about if you have a claim you want coverage for.
Business Owner's Policy's are the standard and should be a policy you purchase no matter what you do in the IT Consulting world.
READ NEXT: Technology Company Workers Comp Insurance
Professional Liability Insurance
Once you get that under control, the main differentiation between IT consulting and computer programming is the difference between professional liability insurance for an IT consultant and tech errors and omissions, which is really for companies building software, software-related products, and applications.
If you are a true IT consultant, you need professional liability. And that is fairly straightforward. It can often be plugged into or attached to your business owner's program or standalone.
Neither one is right or wrong. It all depends on the company, the policy language, and all that stuff and the pricing.
If you are in the software programming business, that is Tech Errors and Omissions Insurance.
Tech Errors and Omissions Insurance will be way more expensive, with a way broader coverage, and way more specific to building applications.
If you're doing IT consulting, you don't necessarily need a Tech E&O policy, but you do need professional liability, and that's what you want to focus on.
Cyber Liability Insurance
Often, IT consultants tell us, "Hey, we have a security program and security protocols, so we do not need cyber insurance."
Security protocols are important, you need to have that safety net underneath security in the form of cyber liability insurance.
This is because a lot of the new age, the 21st-century cyber-attacks have nothing to do with hacking a system and everything to do with things like ransomware, where they're just plugging some program into your system, or social engineering, where they're just using your system as a jump-off point, recreating your email signature and a very close version of your email address and your name likeness and whatever to try to scam your clients.
This is a huge concern area, meaning cyber liability insurance is a must for every IT consultant.
READ NEXT: The BEST Technology Insurance Companies
The Rub
Beyond the business owner's policy, professional liability, and cyber liability, if you have employees, you need workers' comp insurance.
There may be other coverages you want to talk through but at a minimum, its critical to have at least those three to start.
And then if you are creating programming, applications, that kind of stuff, doing any kind of software programming, we want to talk about tech E&O, but they are different products.
This is where we come in at Rogue Risk.
If your current insurance professional has never addressed issues like this with you before, I’d encourage you to reach out to us today.
- You can call or text us at 518.960.6600
- Click here to contact us via email.
I look forward to introducing you to a new way of viewing your insurance program.
Thank you,
Ryan Hanley
