Find insurance quotes for SaaS companies
Save money by comparing quotes from trusted insurance carriers.
SaaS Business Insurance
Website Hosting / ASP / SaaS / Data Center / Cloud Services
Choose from the nation's best insurance providers
Why do software as a service (SaaS) companies need business insurance?
A service outage could be financially devastating for a small SaaS provider or startup. Business insurance covers the cost of lawsuits brought by customers harmed by a disruption. It can also pay for property damage and injuries. Some policies, such as workers' compensation, may be required by law.
Find the right coverage
Insureon helps SaaS business owners find insurance coverage that matches their unique risks.
Get free expert advice and peace of mind knowing you have the right property and liability coverage for your SaaS company.
What types of insurance do SaaS businesses need?
These insurance policies cover the most common risks of SaaS companies.
Technology errors and omissions insurance
Technology E&O insurance, also called professional liability insurance, can cover lawsuits related to problems with your SaaS solutions for clients, such as outages and lost data.
BEST FOR
- Service downtime that harms clients
- Problems with service functionality
- Misrepresentation in a contract
Cyber insurance
Also called cybersecurity insurance, this policy covers financial losses from cyberattacks and data breaches. It's recommended for any SaaS business that handles personal information.
BEST FOR
- Customer notification expenses
- Fraud monitoring services
- Data breach legal costs
General liability insurance
This policy covers basic risks, such as a client who trips on a loose cable at your SaaS office and suffers an injury. Bundle it with commercial property insurance for savings in a business owner’s policy.
BEST FOR
- Customer bodily injuries
- Customer property damage
- Libel and other advertising injuries
Fidelity bonds
Fidelity bonds provide compensation for SaaS businesses and their clients if an employee steals from them. They're sometimes called employee dishonesty bonds or crime insurance.
BEST FOR
- Employee theft or fraud
- Unlawful data access by an employee
- Illegal funds transfer by an employee
Workers’ compensation insurance
Most states require workers' comp for businesses that have employees. It also protects sole proprietors from work-related injury costs that health insurance might deny.
BEST FOR
- Medical payments for work injuries
- Disability benefits
- Lawsuits from employee injuries
Commercial auto insurance
Commercial auto insurance covers the cost of an accident involving your company's vehicle. Each state has its own requirements for auto liability insurance.
BEST FOR
- Car accidents
- Vandalism and theft
- Weather damage
Looking for different coverage? See more policies.
How much does SaaS business insurance cost?
A small business that offers a single SaaS product will pay less for insurance than a larger software company that runs several SaaS platforms for clients.
Factors that affect insurance premium pricing during underwriting include:
- Technology products and services offered
- Business property and equipment
- Number of employees
- Business size and revenue
- Insurance products purchased, such as employment practices liability (EPLI) or directors and officers insurance (D&O)
- Policy limits and deductibles
How do I get SaaS business insurance?
It's easy to get the right SaaS insurance if you have your company information on hand. Our insurance application will ask for basic facts about your business, such as revenue and number of employees. You can buy a policy online and get a certificate of insurance with Insureon in three easy steps:
- Complete a free online application
- Compare insurance quotes and choose policies
- Pay for your policy and download a certificate
Insureon's licensed agents work with top-rated U.S. insurance companies to find coverage that fits your small tech company, whether you work independently or hire employees.
Verified business insurance reviews
Hear from customers like you who purchased small business insurance.
Common questions about insurance for SaaS companies
Review frequently asked questions (FAQs) about SaaS and software business insurance and more.
Why is business insurance necessary for SaaS businesses?
Software as a service business owners might think their business is low-risk compared to others. Unfortunately, a frivolous lawsuit can still have a serious impact on your business, whether you're just starting your business or are well established.
Here’s a closer look at some key insurance products and why you should carry them:
- Technology errors and omissions insurance, sometimes called tech E&O or tech professional liability insurance, is a bundle of E&O with cyber insurance. This policy can help you with legal fees and court costs if a dissatisfied client sues you over your work performance or third-party cyber incident. It covers the cost of customer notification, credit monitoring, legal fees, and fines.
- Commercial property insurance covers your business property and equipment if it's damaged, lost, or stolen. This policy is often bundled with general liability insurance in a business owner's policy (BOP) to save money. Should your machinery or equipment suffer a mechanical or electrical failure, equipment breakdown coverage would provide the funds to repair or replace the damaged equipment.
- Electronic data processing insurance covers electronic devices such as computers, storage devices, and the data they contain. Also known as computer coverage or data processing coverage, EDP insurance can help protect your business income.
- Business income insurance, also known as business interruption coverage, offsets your lost income when your business is forced to close because of a covered peril, such as property damage. These funds help you cover your normal operating expenses until you can resume business operations.
Are SaaS companies required to have insurance?
While several policies aren't required by law, software companies can protect their businesses and qualify for contracts and leases by carrying the right insurance coverage. For some SaaS businesses, workers' compensation and commercial auto insurance may be required.
Typically, SaaS providers will apply for general liability insurance first. This policy helps cover common business risks such as customer injuries, damage to a customer’s property, and advertising injuries.
Even small software businesses are vulnerable to the same exposures and lawsuits as larger businesses. This is another reason why you should consider software as a service business insurance.
In order to accept certain contracts, you may need to have a fidelity bond, which reimburses the client if one of your employees commits fraud, theft, or forgery.
Do SaaS businesses need professional indemnity insurance?
Much like other tech companies, software as a service businesses aren't required by law to carry professional indemnity insurance. However, it should be a key component of your business's risk management plan.
Professional indemnity insurance, also called professional liability insurance or errors and omissions (E&O) insurance, protects you in the event a client files a lawsuit against your software business for an error, mistake, or professional negligence.
You can bundle professional liability insurance for SaaS businesses with cyber insurance into a technology professional liability policy, which is more commonly referred to as tech E&O. This would be a more affordable insurance option than purchasing the policies individually.
How can I save money on Saas business insurance?
There are many steps you can take to get affordable coverage that meets your insurance needs.
Start by comparing free business insurance quotes from leading insurance companies through Insureon’s online application. If you're unsure what software or SaaS business insurance policies you need, our licensed insurance agents can help make sure you get the right, most affordable coverage.
Most small businesses can get insured and download a certificate of insurance within hours of applying for quotes.