Web Developer Insurance

The success or failure of a client's business can depend almost entirely on its website, which makes insurance essential for web developers. For example, you could face a lawsuit if a website you built doesn't function correctly, causing a client to lose customers.

Errors and omissions insurance (E&O), also called professional liability insurance, covers legal costs related to professional negligence. It's often required in terms of contracts, as it protects clients from potential losses related to your services.

Web developers and other types of software developers often bundle E&O with third-party cyber insurance in a package called tech E&O, which covers lawsuits related to cybersecurity failures that affect clients. For example, a web developer might be sued over a data breach if a client's website still has default security settings and passwords.

Tech E&O can also protect against copyright infringement claims when paired with IP coverage or media liability insurance. While a general liability policy covers personal and advertising injuries related to your own business and its advertising, you'll need specialized coverage for the content you produce for others.

You'll also need cyber insurance, or data breach insurance, to cover data breaches and cyberattacks at your own company. It's a worthwhile investment for small businesses, which are often targeted because of their limited defenses. Cyber insurance helps pay for data breach investigations, ransomware attacks, and notification costs that can add up quickly.

Web development companies can protect their livelihoods and qualify for contracts by carrying the right insurance coverage. Depending on your state, some policies may be required by law.

Here are some situations where web developers must carry insurance:

• Your clients require coverage. Clients may include tech E&O, general liability, or a fidelity bond in their contractual requirements to gain protection against financial losses related to your services.
• You rent an office or apply for a loan. You might need general liability insurance to sign a lease or get a business loan.
• You have employees. Most states require workers' compensation for businesses that have employees, even if they work part-time.
• You have a company car. Similarly, you'll need commercial auto insurance to comply with state laws if your business owns a vehicle.

Even when it's not required, it's important to have business insurance. Otherwise, a lawsuit over project delays, a simple coding error, or an auto accident could potentially bankrupt your business.

Web developers who work as freelancers face many of the same risks as bigger businesses, and often have similar insurance requirements.

Even if you work from home, your clients might require you to have tech E&O, general liability, or a fidelity bond so they're financially protected from losses related to your services. Tech E&O provides crucial protection against data breach lawsuits for freelancers who handle sensitive data for their clients.

You'll also need cyber insurance to make sure your own business is protected in the event of a data breach or cyberattack.

Homeowner's insurance may offer only limited coverage for business property, so you may need business personal property (BPP) coverage for your computers and other supplies.

If you drive your own car to meet clients, you should carry hired and non-owned auto insurance (HNOA). You'll need this coverage to supplement personal auto insurance, which won't cover driving for work purposes beyond a commute.

Workers' comp insurance isn't required for freelancers, but it's a good idea to carry this coverage for peace of mind. Your personal health insurance likely won't cover injuries that are related to your job.

Web developers often look to the following insurance products to protect their business financially: 

• Commercial property insurance covers your office and everything in it in the event of a fire, storm, or burglary. Should your business equipment suffer a mechanical or electrical failure, equipment breakdown coverage would provide the funds to repair or replace the damaged equipment.
• Business income insurance, also known as business interruption coverage, offsets your lost income and pays for daily operating expenses if a fire or other covered property claim forces your business to close temporarily.
• Electronic data processing (EDP) insurance covers electronic devices such as computers, storage devices, and the data they contain during a power surge, fire, natural disaster, or similar incident.

If you need help finding the right coverage, don't hesitate to contact our insurance experts. They can help you find cost-saving bundles, choose the best coverage for your insurance needs, and add endorsements for any special risks.

It's easy to find affordable insurance with Insureon. Our easy online application lets you compare quotes from trusted providers to find policies that fit your budget.

Other ways to save money on business insurance include:

• Bundle policies. Small web dev firms can often save money by purchasing two or more types of coverage in one package, such as a business owner's policy or tech E&O.
• Customize your coverage. Choose lower limits or higher deductibles to reduce your premium, but make sure your policy can still cover a potential claim.
• Focus on cybersecurity. Cybersecurity controls, such as multi-factor authentication, protect your company from data breaches and other cyber incidents. Insurance companies often provide discounts for approved security measures.
• Risk management. Policyholders can prevent employee injuries and customer accidents that lead to claims by eliminating loose power cords and other tripping hazards in the office, and by providing ergonomic setups for employees.

Our insurance agents can help you find the right insurance solutions for your business needs, whether your company creates tailored websites for businesses, builds web apps, or specializes in UX / UI design.