The IT industry is vast and covers a huge array of professions including IT Software Development, Design, Maintenance, Analysis, Testing, Programming and/or Sales as well as many more.
IT professionals can be liable for mistakes or failures that cause a third party to suffer a financial loss such as:
- Loss of data
- Business interruption
- Data migration difficulties
- Inadequate hardware or software support
- Injury caused by faulty hardware or software
- Physical loss of equipment
- Incompatible, inappropriate or ineffective hardware or software
Claims Scenario for System Automation
Claims can occur in any part of the industry from any of the above professions, for any of the above reasons (as well as many more) and this article will show one scenario of how this can occur. The following scenario is specific to system automation.
Scenario – A company contracted a software developer to design and implement a solution to automate their business activities. A customised solution was developed and installed. All of the company's records were then transferred to this new system.
Problem – One week after the system went live it crashed. This revealed that the developer and not properly installed a back-up for the transferred data. As a result, the company's client information, billing records and other account details were lost.
Outcome – The company sued for damages in excess of over $500,000 for breach of contract, negligence and consequential loss of profits with the cost of installing a replacement system. the insured's policy responded and plaid the claim in full.
As you can see from the above scenario, the IT Company simply made a mistake but it could have been a very costly one if not for their insurance. The solution is simple – purchase insurance cover to protect your business from costly claims.
An Insurance Policy Tailored to the IT Industry
Cover for your IT business is available under a combined Professional Indemnity and Public & Products Liability Insurance policy that is tailored to the IT Industry. The IT Industry is unique in that the cause of loss and subsequent claims for compensation can be quite difficult to determine.
- A developer makes available their software to download online. Is the developer providing a product or service?
- A new software program has been installed at your work and, subsequently, all data is lost. Was the causation of the loss a result of the product or the service?
- You seek assistance from an IT help desk and you download a software patch. Is this a product or service?
IT Insurance Policies can provide coverage for claims arising from failure of the insured products, services and/or advice and includes infringement of copyright, trademark, registered design, or any other plagiarism, libel or slander. It also covers breach of confidentiality and privacy.
Quotation Options for IT Professional Indemnity & Liability Insurance
As the business of IT Professional differ, so too do our insurance solutions. we have many options available for you to obtain a quote. However, if you would like to discuss your specific needs to obtain a quotation over a phone, please contact us.
Please also find some useful links to provide you with some further information regarding IT Professional Indemnity and Liability Insurance:
Disclaimer – “This material contains general information only and may not suit your particular circumstances. To decide if a policy is right for you please carefully read the relevant Product Disclosure Statement (PDS) and/or Policy wording. While we have exercised due care and skill in preparing this information, Optimum Insurance Services (Optimum) does not accept any legal responsibility or liability for negligence or otherwise to you or anyone else who seeks to rely on this information. This includes, without limitation, loss arising from a possible failure of the information to comply with statutory or regulatory requirements or the failure of the information to identify other terms and conditions beyond those considered in this document. You should obtain advice to ensure that your policy provides adequate cover for your circumstances.
“Optimum Insurance Services Pty Ltd is a Corporate Authorised Representative of Insurance Advisernet Australia Pty Ltd (Car No. 291220), Australian Financial Services Licence No 240549, ABN 15 003 886 687.”