Is Cyber Liability Insurance Enough Coverage for IT Contractors?

Is Cyber Liability Insurance Enough Coverage for IT Contractors?

The information technology field is one of Canada’s faster growing and exciting fields today. Unfortunately though, liability in the IT environment is a very real issue for many professionals. We can’t stress enough the importance of being properly insured for Canadian IT contractors.

But what is considered “proper insurance”? And is cyber liability coverage enough? Today we will cover these questions.

As an IT contractor, you are hired to perform given tasks. Since failure to perform the requested task could cost your client money, it is absolutely necessary to be prepared to go to court should you get sued. Your first line of defense against liability claims is implementing the appropriate risk management practices for your industry, such as collaborating with your client to identify the scope of work; obtaining a signed contract from your client detailing the expectations, timelines and other pertinent information; documenting project task and completed steps; and of course staying in constant communication with your client during the course of the project. To further safeguard yourself, your career and your finances from an embarrassing lawsuit, back-up all those precautions with a reliable Insurance policy that will help pay for legal fees and settlements should you make an inadvertent error or omission.

Depending on what type of IT contractor you are and what you specialize in, mistakes can range from intellectual property infringement to software failure. It can even include breach of confidentiality. Most of these scenarios are not covered under a cyber liability insurance policy but they are under a professional liability insurance policy. The term “cyber liability” is an especially board term and IT professionals usually assume this type of policy will cover them in the event an error or omission in their work causes the client a financial loss and public embarrassment. Unfortunately, cyber liability insurance policies are typically only useful for covering liability arising from business interruption, data breach, loss or destruction and computer fraud. This policy should not be confused with an IT professional liability insurance policy which is intended to protect IT professionals who are providing products, services and advice such as website designers or IT consultants.

To go back to the original question… “Is cyber liability insurance coverage enough?” Unfortunately, it’s not always. The field of IT is so complex and detailed that it is best to make sure that you take the necessary steps to protect yourself should an unforeseen mistake occur that does open the door to a potential claim against you. Whether you are an IT manager, an IT analyst or a software consultant, you should look into purchasing an IT professional liability insurance policy for extra peace of mind and as a safety precaution.

EasyCover enables you to request a free professional liability insurance quote and purchase insurance coverage online easily and within minutes. No waiting, no hassles, fast, effective insurance coverage available at your fingertips. You can also speak to one of our licensed insurance brokers by calling us toll free at 844-439-2683 or by using our live chat during regular business hours, MST time, Monday through Friday.