Tech Business Insurance – Terms to know

How is insurance for tech companies different?

Technology companies own valuable intangible assets, such as sensitive data, software and intellectual property. Where standard general liability insurance policies deliver protection in the event of bodily injury or property damage, technology insurance is specifically tailored to protect against the significant risk of economic loss related to intellectual property, network liability, and network and cyber-property security.

The UK’s technology sector is growing 2.6 times faster than the rest of the economy* and is worth £184 billion**


With the tech sector rapidly growing, specialised technology insurance has followed. The terminology being used within these new tech insurance policies is still evolving as more claims are handled and new exposures are discovered. It can be hard to keep up with the new terminology and phrases so we have collected a few of the most common terms to help you out when discussing your tech business insurance needs with your broker;

Contractual Liability

Failure of products and services in the tech sector may result in a pure financial loss. In the absence of a special relationship under the tort of negligence, one will be created through the contractual relationship of the parties. If contractual liability is excluded from your insurance policy, this may result in you not being fully protected against your liabilities. 

Failure to Perform/Efficacy

Efficacy exclusions are often applied to product liability insurance policies where underwriters consider the risk around 'failure to perform' too severe to insure. It's important to identify products, like medical devices, where the 'failure to perform' is intrinsically linked to its safety. To accept an efficacy exclusion on such risks may undermine the extent of cover being provided so is worth looking out for. 

Cyber Liability

Cyber threats can emerge from a cyber-attack, theft or loss of data, unauthorised system access, cyber-crime, or the adverse consequences that arise from email, website and social media misuse. It's fair to say that this is a topic that could apply to every business but tech companies arguably are at higher risk because they're responsible for third party data or network security, as well as their cyber risks.

See how exposed your business could be from a cyber attack by completing our cyber risk calculator in the link below.

Cyber Exposure Calculator


This can include websites, data and networks that your company owns. These intangible assets can all be damaged. To protect your cyber property you may need to broaden the property enhancements on your existing policy. Also, check if you have any coverage that would offer protection if your company or an employee caused damage to another organisation’s cyber property.

Technology E&O

Technology errors & omissions (E&O) cover protects against claims by a client where they have suffered a loss due to mistakes your company may have made. These mistakes must be due to error or oversight in a product such as a software programme or web service.

Media and intellectual property liability

All content on the internet is considered to be published, meaning it is subject to copyrights and infringement. Negative content about a person or company can be considered libellous. Take caution when publishing or posting anything to websites, forums or social networking sites. Tech insurance packages can provide you with cover for unintentional breach of copyright, trademark or registered design.

Keeping your business protected

The exposures and threats of technology business operations will continue to grow as new tech is developed and the industry expands. We’ve highlighted some key areas of cover that will often be lacking or excluded under a standard business insurance policy.

It's never a bad idea to talk to a broker about your insurance policies because you can get expert advice on what you might be missing out on. Alan & Thomas Insurance Group have access to tailored tech insurance solutions and you've got absolutely nothing to lose by discussing your current policy with us and what you might need. Whether you are a start-up, emerging or an established SME trade, get in touch with Alan & Thomas today to find out more.

*tech nation 2018 **

Want to talk about your Tech Business Insurance?

Contact Nick Eliis or one of our team today on 01202 754900.