IT Consultant Insurance
Coverages Needed by IT Consultants and Contractors
Enclosed in the table below are some typical coverages that are needed in the Technology industry along with some approximate pricing.
We can usually issue the policy and provide you with the appropriate certificate of insurance for your vendors within “2 hours”.
General Liability
Below is a detailed description of the proposal for General Liability Insurance. The annual premium is $425. You can make monthly payments if you like.
This Policy combines all of your insurance needs and packages them into one competitively priced product.
| Liability Coverages | Limits of Insurance | Premium |
|---|---|---|
| Business Liability Insurance for Each Occurrence | $1,000,000 | Included |
| General Aggregate | $2,000,000 | Included |
| Products/Completed Operations Aggregate | $2,000,000 | Included |
| Personal and Advertising INjury | $1,000,000 | Included |
| Damages to Premises Rented to You | $300,000 | Included |
| Medical Expenses | $10,000 | Included |
IT consultant insurance besides being a requirement from most of your vendors can also be used as a competitive advantage for you. If you are paying less for your overall technology liability insurance then your competitors, that can be a competitive advantage for you. Also, by having comprehensive coverages in place for your IT business insurance you could be protecting your assets and cash flow from claims and losses more effectively than your competition is currently doing.
Technology liability insurance and IT professional liability insurance needs to be crafted carefully to make sure that you, your company and your subcontractors all have the appropriate liability insurance in place.
It gets more convoluted when you are trying to intertwine the IT consultant insurance and the IT contractor insurance into your specific project for your clients. The IT professional liability insurance is a unique coverage for the IT consultant and the IT contractor. Tech E. & O. has strict underwriting requirements because of the breadth of the coverage that is being provided.
You as the IT consultant need to clearly define in writing where the IT consultant insurance and the IT contractor insurance start and stop. Normally the most troublesome area arises in the area of workers compensation insurance. Even though you are calling someone a subcontractor they may or may not be a subcontractor and in fact they may be an employee. If they are an employee this subjects you to the employment workers compensation laws of the state that you are operating in.
Information technology insurance is a complex and technical area in the insurance world of coverages. If you as a small business owner do not take the time to properly sort out the IT insurance issues, you may find that the insurance company will sort it out for you at audit time. If you mis-classify an employee as a subcontractor you could be faced with a substantial increase in additional premium when your policy renews. The IT consultant insurance typically is based upon payroll and gross annual receipts. If you are not properly accounting for an employee payroll versus a subcontractor payroll you can and will be facing additional premiums at the end of your policy term. Almost all of the technology liability insurance policies are subject to audit, which means they will be reviewed by the insurance company for the accuracy of payroll and sales at the end of the year.
Many IT consultants fail to have mirror contracts with their subcontractors as they personally have with their clients and/or vendors. If the IT consultant is required to have technology liability insurance, IT professional liability insurance, workers compensation insurance, umbrella insurance, and possibly crime insurance, and your IT subcontractor does not have the same coverages and limits that you do; there can be substantial gaps in coverage because of your subcontractor relationship.
IT consultant insurance is very broad and comprehensive and can protect many facets of your business. Making sure that you have the appropriate insurance company, coverages, limits, and a broker who has the experience and expertise in technology insurance, will give you a competitive advantage over your competition.
R. Glenn Matsen, CEO
MBA, CPCU, ChFC, ARM
707.528.7299 ext. 303
707.528.1662 fax
info@techologyinsurancequote.net/
Lic. #05083580
