IT Cover | It’s more than you think

IT Liability.  For some confusing or even scary.  But, there is nothing to fear.  If you don’t know much about this product, then this article should help you get your foot in the door as far as IT Liability is concerned.

Two Becomes One

An IT Liability policy issued by Berkley Insurance Australia (BIA) is made up of two sections, Professional Indemnity (PI) and Public & Products Liability (PL).  The PI section covers a financial injury or financial claim as a result of the provision of IT products and/or services. The PL section covers bodily injury and property damage as a result of the provision of IT services and/or products.

Do you need both PI and PL sections?

The general answer is yes.  There are some rare cases where BIA will offer only one section. For example, where the PL program is being handled separately. General rule.  Have them both included. If they are not combined you could run into some trouble if a claim does arise.

IT Products vs Services

IT services provided by the insured can include consultancy services, design (UX/UI/web), specification training, data management, hosting services, project management, and software development.  This list is not exhaustive as the tech space is constantly evolving.

IT products can include hardware such as laptops, desktops, printers or servers. It can also include all computer-based CCTV systems, and home automation and other electronic-based devices. And of course, software is a product (and a service, it can be both).

Let’s break down the coverage now…

Contractors

Regardless of the amount of work a contractor is providing for the insured, the contractor will be covered. Now, of course, that’s only in relation to services provided on behalf of the insured. Some other policies require the contractor to provide a certain percentage of the insured’s work to be covered. However, for a BIA IT Liability policy, the percentage does not matter. It could be 2% or 80%.  Keep in mind, BIA only covers the percentage of work the contractor does for the insured, not work provided elsewhere.

Principals Indemnity and Waiver of Subrogation

This can be a little bit tricky. BIA’s IT Liability policy does include as standard principal’s indemnity coverage and a waiver of subrogation, but it’s only in relation to that principal’s indemnity.

On occasion, your client may come across a contract where they have to provide a blanket waiver of subrogation. Unfortunately, that is not a standard cover and we are unable to provide such coverage outside our standard offering.

Leased vs Owned Properties

BIA automatically covers the insurance lease requirements of rented premises. Now, what about if the insured owns the premises? BIA provides owner’s liability coverage on the basis that the premises is 100% owner-occupied by the insured. It could be an office, warehouse, factory, etc., and includes multiple premises.  As long as they are 100% owner-occupied.  If the insured leases part of its owned premises to another business, we do not cover the owner’s liability for the leased premises.

USA Territorial or Jurisdictional Cover

Territorial cover is important these days, especially if you have clients who are selling software online. Anything sold online, is automatically a worldwide risk. Even if the insured operates locally, if someone from overseas can access their products/services the exposures are there. BIA’s IT Liability policy has a worldwide territorial cover as a standard. The only jurisdictional exclusion is the USA and Canada.

On a case-by-case basis, BIA may consider providing some cover for the USA and Canada. However, any cover for these jurisdictions will attract higher premiums and excesses.

Extending for Incidental Cover

BIA understands that even though a business may be an IT company it may have some incidental non-IT services.  A great example is IT recruitment services where they manage IT contractors, including the payroll.  The payroll would be considered an incidental to a recruitment placement service.

BIA can also cover a management consultant business if the service is predominantly IT-focused. Cover can be extended to the incidental services that are not IT-focused.

High Capacity Limits available

BIA specialises in IT Liability.  BIA’s IT Liability policy can provide up to $20 million Professional Indemnity cover and $50 million Public and Products Liability cover.

If you would like further information on IT liability please contact our local specialist underwriting team.

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