Tech E&O insurance is professional liability for technology businesses. It helps pay legal defense costs and covered damages when a customer claims your software or technology services caused a financial loss. A bug, failed integration or implementation mistake can lead to that kind of dispute. Source: Travelers.
You might start looking because a customer requires it. You might also want protection because other businesses rely on your product. Either way, the policy needs to match the work you actually do.
What Tech E&O typically covers
Think about what a customer could blame your company for:
- Your software calculates invoices incorrectly, and the customer loses money.
- An integration fails and disrupts the customer's operations.
- Your implementation team makes a mistake that causes financial harm.
Whether a claim is covered starts with the policy's definition of technology products and services. Describe your software, hosting, support, consulting and implementation work when applying, including work done by contractors. Ask how new products are treated when you launch them mid-policy.
Who needs Tech E&O insurance?
SaaS companies, API businesses, software developers and technology consultants should consider it when customers depend on their work. Start the review before signing a contract that requires professional liability or Tech E&O.
Customer requirements vary. New York's insurance procurement guidance, for example, lists Tech E&O and Cyber as distinct coverages. Read the actual insurance clause to see what your customer requires.
What Tech E&O does not automatically cover
Our Tech E&O coverage summary distinguishes negligence claims from claims arising solely from breach of contract. Even with the SLA extension, service credits, refunds, SLA penalties and liquidated damages remain excluded. Intellectual property coverage also needs the appropriate extension.
Flag those exposures before buying. If you subcontract development or promise uptime, ask which endorsements are included and what remains excluded. Check the endorsements that will be part of your policy.
For the difference between a software-performance claim and a breach, see Tech E&O vs. Cyber insurance.
Match your customer contract to your quote
Put the insurance clause beside the quote and check these six things:
Check — What to confirm
- Requested coverage — Does the policy cover the technology work you sell?
- Required limit — What does the customer require for each claim and in total?
- Proposed limit — Does the quote meet both numbers? Are any limits shared with Cyber?
- Retention — How much would your company pay toward a claim?
- Defense costs — Do lawyers' fees reduce the amount left for damages?
- Evidence needed — Which declarations, endorsements and certificates does the customer need?
For example, a quote with $1 million per claim and a $2 million annual aggregate does not meet a requirement for $2 million per claim.
Resolve differences before you bind. A Certificate of Insurance (COI) provides evidence of coverage; it cannot add coverage missing from the policy. The New York Department of Financial Services explains that distinction.
Check the dates as carefully as the limit
Tech E&O commonly uses claims-made coverage. Two dates matter: when the customer makes the claim and when the alleged error happened. The policy may exclude work before its retroactive date, and you must follow its claim-reporting requirements. The New York insurance regulator's explanation covers claims-made and prior-acts coverage.
If you switch insurers, ask about preserving coverage for earlier work and whether an extended reporting period is needed. Keep the answer with your policy documents. Our switching guide walks through the handover.
Why choose Corgi for Tech E&O?
We help you work through coverage for the product you sell and the contracts you sign. Our Tech E&O options address development, integration and data migration, with an extension available for subcontracted technology services.
If you build with AI, we offer a modular AI endorsement so you can select the protection your product needs. AI-related claims are excluded from the standard policy; each selected module has its own limit and retention. Our Tech E&O and AI guide explains what to review with your quote.
That practical help matters when procurement is holding up a signature. Eragon founder Josh Sirota describes how we handled the policies, limits and certificates for an enterprise deal that closed in days. Read Eragon's story.
Send us your customer's insurance clause, a short description of your product and your deadline. We can review Tech E&O and Cyber together and work through the details with you before you buy. Talk to Corgi.
FAQs
Is Tech E&O required for SaaS companies?
A customer may require it before signing a contract or completing vendor onboarding. Check the insurance clause and any industry requirements that apply to your services. Your funding stage alone does not determine what coverage you need.
How much does Tech E&O cost?
Get a quote based on your work, customers, limits and retention. Compare Tech E&O separately from a package price that also includes Cyber or General Liability.
How much Tech E&O coverage should a startup buy?
Start with customer requirements, then consider the financial harm your work could cause. Check the per-claim limit, annual aggregate and whether defense costs use that limit. A contract minimum is a starting point, not a measure of your total risk.
