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IT consultant insurance that protects your business
A claim that your advice caused a financial loss could devastate a small technology consulting company. IT consulting insurance covers legal fees from dissatisfied clients. It can also cover injuries, theft, and other risks.
Find the right coverage
Insureon helps you find IT consultant insurance coverage that matches your unique risks.
Get free expert advice and peace of mind knowing you have the right property and liability coverage for your consulting firm.
Which business insurance policies does an IT consultant need?
These policies cover the most common IT consulting risks.
Technology errors and omissions insurance
Tech E&O bundles E&O insurance, also called professional liability coverage, with cyber insurance. It covers legal defense costs related to claims of negligence.
BEST FOR
- Work errors and oversights
- Late or undelivered professional services
- Data breach lawsuits
Cyber insurance
A cyber liability insurance policy helps IT consultants recover financially from data breaches and cyberattacks. It's recommended for any business that stores personal information.
BEST FOR
- Data breach investigations
- Client notification expenses
- Fraud monitoring services
General liability insurance
This policy covers risks every IT consultant faces, such as dropping a client's laptop. Bundle it with commercial property insurance for savings in a business owner’s policy (BOP).
BEST FOR
- Client bodily injuries
- Damaged client property
- Slander and other personal injuries
Fidelity bonds
This bond, also called an employee dishonesty bond, compensates clients if an employee at your consulting firm steals from them. It's often required for client contracts.
BEST FOR
- Employee theft or fraud
- Unlawful data access by an employee
- Illegal funds transfer by an employee
Workers’ compensation insurance
Small business owners buy this policy to meet state insurance requirements for employees. It also protects sole proprietors from work injury costs that health insurance might deny.
BEST FOR
- Employee medical expenses
- Disability benefits
- Employee injury lawsuits
Commercial auto insurance
Commercial auto insurance can pay for property damage and medical bills from an accident involving a company vehicle. Most states require it for business-owned vehicles.
BEST FOR
- Injuries caused by a company car
- Property damaged by a company car
- Vehicle theft and vandalism
Looking for different coverage? See more policies.
How much does insurance cost for IT consulting businesses?
An IT consultant who works independently can expect lower insurance prices than a bigger business.
Factors that affect IT consultant insurance premiums include:
- Professional services you offer
- Business property and equipment
- Annual revenue
- Types of insurance purchased
- Coverage limits and deductibles
- Any endorsements, such as intellectual property (IP) insurance or business interruption insurance
- Claims history
Verified business insurance reviews
Hear from customers like you who purchased small business insurance.
"Everybody needs cyber [insurance], and small businesses are the most targeted."
– Holly Burton, Assistant Director, Sales
How do I get IT consultant insurance?
It's easy for IT consultants and cybersecurity consultants to get 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 insurance agents work with top-rated U.S. providers to find coverage that fits your IT consulting firm, whether you work independently or hire employees.
How E&O insurance protects your business
View video transcript.
No, no, no! My client's network was working just fine last week!
You made a mistake, yeah, you made a mistake. You made a mistake, and it doesn't matter what you say. You missed the boat, now you will have to pay!
Actually, you have errors and omissions insurance. It covers legal costs if you make a mistake and your client sues you.
Mistake! Mistake! Ohhh, this was a mistake! Mistake! Mistake! Ohhh, this was a mistake!
You can get all the coverage your business needs by following this link. Protection is peace of mind!
FAQs about IT consultant insurance
Review answers to frequently asked questions about IT and computer consultant insurance and more.
Why is business insurance necessary for IT consultants?
IT consultants need insurance to protect against unexpected costs that could devastate their small business.
When you start out as an IT consultant or other IT services business, you likely won't have a lot of resources to spend on an injury or a lawsuit. That means a simple accident or lawsuit could have a serious impact.
One of the most important policies for your profession is technology errors and omissions insurance (tech E&O), which bundles cyber insurance and errors and omissions insurance at a discount. Also called tech professional liability insurance, this policy helps pay legal fees if a dissatisfied client sues you over your work performance.
While E&O insurance covers lawsuits related to professional negligence, cyber insurance extends that coverage to include data breach lawsuits—both are crucial for IT consultants.
Specifically, the third-party cyber insurance included in tech E&O covers claims that you failed to prevent a data breach at a client's company. For instance, a data breach might happen because you recommended insecure software to a client, or failed to install important security updates on their systems.
Keep in mind, you'll still need general liability insurance. While cyber insurance covers third-party data breaches, a general liability policy covers common third-party accidents, such as a slip-and-fall injury or an employee who drops a client's laptop.
If I work from home, do I need IT consulting insurance coverage?
IT consultants who work from home face many of the same risks as bigger businesses. So, you likely need business insurance for the same reasons:
- To sign contracts. Your clients might require you to carry coverage in order to mitigate the risks of working with your small business.
- For financial protection. A work injury or client lawsuit could derail your business financially, if you're uninsured.
- To get a loan. Lenders often require insurance as a prerequisite for a business loan, since they want your company to stay solvent.
Though you might have personal auto insurance or health insurance, keep in mind these won't cover business-related incidents. You'll want to consider hired and non-owned auto insurance (HNOA) if you drive your own car for business use, and workers' comp for protection against work-related medical bills.
Are IT consultants required to have insurance?
In some cases, business insurance is required by law. Clients, landlords, and lenders might also require you to carry coverage.
Here are several situations where IT consultants must have insurance:
- You have employees. Most states require workers' comp for businesses that have employees.
- You have a company car. Similarly, you'll need commercial auto insurance to comply with state laws if your business owns a vehicle.
- You rent an office or apply for a loan. You might need general liability insurance to sign a lease or get a business loan. This coverage shows others your business is protected from legal costs, which reduces their risks as well.
- Your clients require coverage. Clients may include liability insurance as part of a contract requirement to prove that your business can withstand a lawsuit. They might also ask you to have a fidelity bond, which reimburses them if one of your employees commits theft or fraud.
Even when it's not required, it's important to have insurance. Without it, medical bills and legal costs from a single accident or error could potentially bankrupt your business. You can consult an insurance agent for advice about common exposures, or how to fill any coverage gaps.
Do IT consultants need professional indemnity insurance?
IT consultants aren't required by law to carry professional indemnity insurance. However, it's a smart move when building a risk management plan for your business.
Professional indemnity insurance protects you in the event a client files a lawsuit against your IT consultancy for an error, oversight, or other negligent act. It's also called professional liability insurance or errors and omissions insurance.
Specifically for IT consultants and other technology businesses, you can bundle E&O coverage with cyber insurance in a tech E&O policy. This would be cheaper than purchasing the policies individually.
How can I save money on IT consultant insurance?
It's easy to get affordable insurance coverage with Insureon. Our easy online application lets you compare quotes from trusted providers to find policies that fit your budget and your business risks.
Other ways to save money on coverage include:
- Bundle policies. You can often save money when you buy multiple policies from the same provider. The most common example is a business owner's policy, which includes general liability insurance and commercial property insurance.
- Customize your coverage. It's possible to reduce your premium by choosing lower limits or a higher deductible, but make sure it's enough to cover a potential claim.
- Manage your risks. Claims increase your premiums, which is another reason to try and reduce accidents and injuries. You can avoid employee injuries and prevent customer lawsuits by reducing clutter, dim lighting, and other workplace hazards.