What kind of insurance should I buy for my software company?
My software company is an LLC which sells database tracking type software to businesses for about $400 each. In addition to protecting my personal assets with the LLC, I would also like to purchase insurance against any lawsuits that might arise from a customer who might claim that the software caused them to lose time or money in some way. This is a one person product company, not a service business. Should I be looking for E&O insurance, Professional Liability insurance, or ?
Tags: Company, Insurance, Kind, Should, software
You should be looking at Personal Liability Ins.
Also Income Replacement in case of sickness and accidents.
I hope you also have adequate Life Insurance.
E&O is the same as professional liability.
For software designers, there is a company that combines the GL & E&O in one package, for around $2500, depending on the end application.
You need to talk to a local, independent agent who can shop this out for you. If you don’t want a combined package, you won’t find someone willing to give you the E&O unless you ALSO have GL coverage.
**Personal liability insurance won’t cover any BUSINESS related activities.**
Professionals that operate their own businesses need professional liability insurance in addition to an in-home business or business owners policy. This protects them against financial losses from lawsuits filed against them by their clients.
Common reasons alleged in making claims on these policies are negligence, misrepresentation, violation of good faith and fair dealing, and inaccurate advice.
This coverage focuses on the failure to perform, financial loss and error or omission of the products or services sold. Additional coverage for breach of warranty, intellectual property, personal injury, security and cost of contract can be added.