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Cloud Computing Service Provider Insurance
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Why do cloud computing businesses need insurance?
Your clients depend on your services to work anywhere in the world, but if there's a disruption, the result could be a lawsuit. Business insurance protects cloud computing companies from hefty legal fees and settlements. It can also cover costly injuries, fires, cyberattacks, and auto accidents.
Find affordable coverage
Cloud providers can save money by comparing free quotes from top insurers.
Fill out Insureon's easy online application to get quotes and advice from a licensed insurance agent.
What types of insurance do cloud computing businesses need?
These insurance products cover common risks for cloud computing firms.
Technology errors and omissions insurance
Tech E&O covers legal expenses related to your work performance, such as a client who sues over a service outage. You can often add intellectual property and media liability coverage.
BEST FOR
- Data loss from system failure
- Data breach lawsuits
- Breach of a service level agreement (SLA)
General liability insurance
This policy covers basic business risks, such as accidental damage to a client's property. You can often combine it with commercial property at a discount in a business owner's policy (BOP).
BEST FOR
- Slip-and-fall accidents
- Damaged customer property
- Libel and slander lawsuits
Cyber insurance
This policy helps cloud computing companies financially survive data breaches and cyberattacks. It’s sometimes called cybersecurity insurance or cyber liability insurance.
BEST FOR
- Client notification expenses
- Fraud monitoring costs
- Data breach investigations
Commercial auto insurance
This policy covers the cost of an accident involving a vehicle owned by your cloud computing firm. Most states require this coverage for business-owned vehicles.
BEST FOR
- Car accidents
- Vandalism and theft
- Weather damage
Workers’ compensation insurance
Most states require workers' comp for cloud companies that have employees. It also protects sole proprietors from work injury costs that health insurance might deny.
BEST FOR
- Employee medical expenses
- Disability benefits
- Lawsuits from workplace injuries
Fidelity bonds
Fidelity bonds compensate your clients if one of your employees steals from them. Your clients might require you to purchase a bond, especially if you work in financial services.
BEST FOR
- Unlawful data access by an employee
- Unauthorized money transfers
- Other employee theft or fraud
Looking for different coverage? See more policies.
How much does cloud computing business insurance cost?
A cloud computing company with only a few employees will pay less for insurance than a larger business.
Factors that affect premiums include:
- IT / tech services offered
- Business property and equipment
- Business size and annual revenue
- Types of insurance policies purchased
- Policy limits and deductibles
- Number of employees
- Claims history
How do I get cloud computing insurance?
It's easy to get cloud computing, data center, or managed service provider (MSP) business insurance if you have your company information on hand. Our insurance application will ask for basic facts about your business, such as revenue and number of employees. You can buy a policy online and get a certificate of insurance with Insureon in three easy steps:
- Complete a free online application
- Compare insurance quotes and choose policies
- Pay for your policy and download a certificate
Insureon's licensed agents work with top-rated U.S. insurers to find cloud insurance for your company, whether you work independently or hire employees.
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Common questions about cloud computing business insurance
Review frequently asked questions (FAQs) about cloud computing insurance and more.
Why is business insurance important for cloud computing companies?
Cloud computing business owners may think their company has less risks compared to other industries. However, even a small lawsuit can still have a serious financial and reputational impact on your company, whether you're just starting your business or are well established.
Here’s a closer look at some key insurance products and why you should carry them:
- Technology errors and omissions insurance, sometimes called tech E&O or tech professional liability insurance, is a bundle of E&O with cyber insurance. This policy can help you with legal fees and court costs if a dissatisfied client sues you over your work performance or a third-party cyber incident. It covers the cost of customer notification, credit monitoring, legal fees, and fines.
- Business owner's policy (BOP) combines general liability coverage with commercial property insurance at a discount. It protects against common third-party lawsuits and business property damage. You can also added equipment breakdown coverage as a policy endorsement.
- Electronic data processing (EDP) insurance covers electronic devices such as computers, storage devices, and the data they contain during a power surge, fire, natural disaster, or similar incident. Also known as computer coverage or data processing coverage, EDP insurance can help protect your business income against financial losses from data corruption or loss.
- Business income insurance, also known as business interruption coverage, offsets your lost income when your business is forced to close because of a covered peril, such as property damage. These funds help cover your normal operating expenses until you can resume business operations.
- Employment practices liability insurance (EPLI) safeguards your business if you're sued by an employee over wrongful termination or another violation of employee rights. EPLI can also be added as an endorsement to a general liability or business owner's policy.
- Directors and officers (D&O) insurance protects your board members and officers from legal expenses if they're sued over a decision they made on behalf of the company that led to a financial loss. D&O is a type of management liability insurance that provides reimbursement for legal costs (indemnification) over lawsuits related to mismanaged funds, employee grievances, failure to comply with regulations, and more.
- Intellectual property (IP) insurance provides businesses with vital protection against IP disputes. It ensures valuable intangible assets are safeguarded so businesses can focus on innovation and growth instead of worrying about costly legal battles. This type of coverage is usually added as an endorsement to an E&O policy.
Do cloud service businesses need professional indemnity insurance?
Much like other technology-focused businesses, cloud computing firms aren't required by law to carry professional indemnity insurance. However, it should be a key component of your risk management plan.
Professional indemnity insurance, also called professional liability insurance or errors and omissions (E&O) insurance, protects you in the event a client files a lawsuit against your cloud computing company for an error, mistake, or professional negligence.
You can bundle professional liability insurance for cloud computing businesses with cybersecurity insurance into a technology professional liability policy, which is more commonly referred to as tech E&O. This would be a more affordable insurance solution than purchasing the policies individually.
What's the difference between first-party and third-party cyber insurance?
Cyber insurance provides coverage for incident response and its associated costs when you or your customers are affected by a data breach, cyberattack, ransomware, phishing, or other cyber threat. More specifically, there are two kinds of cyber liability coverage you should consider for your cloud computing business:
First-party cyber insurance protects your cloud computing service business against data breaches and cyberattacks that affect you directly, such as a DDoS attack that overwhelms your network. This is crucial coverage if you handle personally identifiable information (PII) or other sensitive customer information.
Third-party cyber insurance provides legal protection if a client blames your cloud company for failing to prevent a data breach or cyberattack at their business.
Tech E&O insurance coverage typically includes both types of cyber insurance, along with E&O insurance to safeguard your cloud business against other lawsuits from dissatisfied clients.
How can I save money on cloud computing insurance policies?
The insurance industry has a wide range of pricing for the same policies, which is why it's important to shop around. You can start by comparing free business insurance quotes with Insureon.
Our licensed insurance agents can help make sure you get the right coverage for your cloud computing business at an affordable price. Most small businesses can get insured and download a certificate of insurance within hours of applying for quotes.
Read more about how to save money on insurance.