Professional Indemnity Insurance for IT Contractors

Business Insurance for an IT Consultant *

As IT consultants provide professional advice to clients on matters ranging from IT consulting and project management, help desk network support, and software development for a fee, they require Professional Indemnity Insurance to protect themselves and their business.

If an IT consultant makes an error, such as providing incorrect information, makes an omission, or provides advice that leads to financial losses for a client, a client may seek to recover these losses from the IT consultant.

Cyber Insurance may provide cover if an IT consultant’s networked computers are hacked, and confidential client data is stolen.

Management Liability Insurance should be considered for IT consulting firms with multiple employees that may be liable when things go wrong with Human Resources, StatutoryLiability and OH & S.

IT consultants also face risks in relation to the commercial premises they operate from fire, perils, and theft or may be liable if a client slips and falls down their stairs, badly injures themselves and claims against them.

Fortunately, suitable business insurance for IT consultants may provide protection against financial hardships that could arise from poor advice, computer hacking, employee matters, accidents, property damage, or legal claims caused by your IT consultancy business activities.

Many Business Owners are UNSURE if they are COVERED PROPERLY.
We help them find affordable and SUITABLE INSURANCE so they can run their business with CONFIDENCE.*

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What Insurance Do I Need as an IT consultant?*

Some of the major types of business insurance covers available to IT consultants in Australia are explained below and include:

  • Professional Indemnity Insurance
  • Business Pack Insurance
  • Public Liability Insurance
  • Cyber Insurance 
  • Management Liability Insurance

Professional Indemnity Insurance for IT consultants *

Professional Indemnity Insurance is the essential cover for IT consultants.

IT consultants may provide services for a wide range of IT professional services, including but not limited to, IT consulting and project management, help desk network support, software development, systems integration, data storage, processing and warehousing, hardware maintenance and installation, web design and development.

If an IT consultant makes an error, such as providing incorrect information, makes an omission, or provides advice that leads to financial losses for a client, a client may seek to recover losses the IT consultant.

Professional Indemnity Insurance may help IT consultants stay in business by paying for legal defence costs, public relation expenses, privacy brief costs and financial losses if awarded against them.

For example:

  • A client may claim damages for loss of income due to YOUR advice given in terms that results in a vulnerability in their firewall.
  • A client may look to claim financial losses suffered as a result of a software program developed and implemented by your firm.

Professional indemnity may help pay for your legal costs to defend yourself.

Your IT consulting business risk depends on the activities you undertake for your clients.

Some of the reasons clients and other parties may make a claim against you include:

  • Financial loss arising from software/system defects
  • Financial loss due to lost or corrupted data
  • Failure to perform and deficiencies
  • Breach of intellectual property
  • Personal injury or property damage resulting from a hardware/product defect
  • Inappropriate or incorrect advice leading to financial loss
  • Damage and destruction of documents
  • Cover for subcontractors
  • Data migration issues
  • Inadequate support for your software applications
  • Business interruption
  • Breaches of client confidentiality.
  • Misstatement or misrepresentation
  • Negligence

Claims can run into the hundreds of thousands of dollars or even millions of dollars, therefore it is important that an adequate level of cover is chosen to protect against major financial loss, which will not only have an impact on your business but could also affect your personal assets.

Business insurance pack for IT consultants*

IT consultants may be able to combine multiple covers in a single business insurance pack policy.

By ‘packaging’ their business insurance into a ‘business pack’ IT consultants can potentially cover many of the risks their business faces in the one policy.

For example, if an IT consultant has a commercial premises, a business insurance pack may provide cover for buildings and contents if they are accidentally damaged by a defined event, such as fire, storm, impact damage, accidental damage, vandalism, or malicious damage.

Other typical inclusions for IT consultants with a business insurance pack are Public Liability & Products Liability Insurance.

If a client slips and fall down your stairs, badly injures themselves and claims against you, Public Liability Insurance may assist you.

Optional inclusions for IT consultants with a business insurance pack are General Property, Contents including Fit Out, Theft, Glass, Business Interruption and Machinery Breakdown

For example, computers may be covered if burgled, and loss of profits may be covered under business interruption if caused by a defined event.

Multiple office locations may be able to be covered on the one business pack insurance policy.

Cyber Insurance for IT consultants *

Your business’ computer system network contains confidential client data, which is a target for hackers.

Cyber insurance may protect your business if your client’s data is held at ransom, cyber extortion or even privacy breaches resulting from Cyber-attacks. 

Cyber insurance may cover costs resulting from a cyber incident, including IT forensics, virus extraction, customer/client notification costs and public relation costs.

Help reduce the impact of damages from a cyber event with cyber insurance – and keep your IT consultancy going.

Management Liability Insurance for IT consultants *

Management Liability Insurance may provide valuable protection for directors, for specified issues relating to Human Resources, OH & S and Statutory Liability.

Why do IT consultants need public liability insurance?*

Public Liability Insurance coverage is essential for all IT Consulting operations.

People and property on site may be hurt or damaged due to accidents involving your IT Consulting business activities.

Protections for IT consultants through public liability insurance in Australia generally include:

  1. Injury to other persons due to your IT consultancy activities – For example, a client is injured when they trip and fall in your IT consultancy premises.
  2. Damage to others property due to your business activitiesFor example , you accidentally drop a client’s laptop and it is badly damaged.

Public liability insurance coverage may protect IT consultants from claims that arise when others allege they are negligent.

An IT consultant’s public liability policy may provide a defence against the ensuing lawsuit when needed and may pay the damages sought by the injured party.

Public Liability Insurance may provide IT consultants with protection for slip-and-trip accidents that occur at their offices.

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What are the costs of IT Insurance?*

How much does business insurance, including professional indemnity insurance, cost for IT consultants?*

Key factors in determining how much business insurance will cost an IT consultant include:

  • the size and turnover of your IT consultant business
  • client size and scope
  • number of staff
  • the optional covers selected
  • your claims history
  • experience and qualification of directors/partners
  • areas of practice
  • fee revenue
  • breadth of coverage
  • indemnity limit
  • excess / deductible

Our helpful business insurance brokers may be able to help you find suitable and affordable business insurance for your IT consulting business on 1300 542 573 

What type of IT consultancy activities may be covered with business insurance?*

Suitable and affordable business insurance and professional indemnity insurance cover may be available for the following IT consulting business activities :*

  • Data storage, processing and warehousing
  • Hardware maintenance and installation services
  • IT & T consulting
  • IT Helpdesk and network support
  • IT project management
  • IT Recruitment and Placement Services
  • Software Development, Design Analysis and Programming services
  • Systems Integrations Services
  • Telecommunications Services
  • Value Added Reselling Services
  • Website Design and development
  • Website Hosting
  • E- commerce application development
  • ISP
  • SCADA/PLC services

Talk to SMART Business Insurance broker about a suitable business and professional indemnity insurance policy for your IT consulting business activities on
1300 542 573 or  contact us online.

Why should IT consultants  use an insurance broker in Australia?*

If you are an IT consultant deciding on whether to use an insurance broker for your business insurance, it is important to consider that brokers act in the interests of you, not the insurer.

Direct insurers and agents act for the insurer This can be important; especially if you need to claim.

Brokers can help IT consultants by sourcing competitive quotes on policy inception, negotiate with the insurance companies to prevent or limit increases on renewal, remarket your policy to other suitable insurance companies where appropriate, talk to underwriters about policy wordings, industry classifications and terms, talk to insurance assessors during the claims process and repairers where necessary.

How do I get an IT insurance quote?*

Simply TALK to a SMART Business Insurance broker on 1300 542 573 or contact us online for suitable and affordable business insurance quotes for your IT consulting business.