Technology Errors and Omission Insurance vs. Cyber and Privacy Insurance

Any step taken to protect your business against liabilities resulting from breached or failed technology is a step in the right direction. However, a business must be sure not to confuse policies and assume coverage exists where it does not.

Two policies that are commonly mistaken for the other are technology errors and omissions insurance (tech E&O) and cyber and privacy insurance. Although both policies contain a number of the same insuring agreements, there are key differences.

  1. Who Tech E&O Insurance Covers
    Tech E&O insurance is designed to cover providers of technology services (ex. data storage companies) or products (ex. computer manufacturers). Tech E&O insurance, as opposed to cyber and privacy insurance, protects companies that store data offsite.
  2. What Tech E&O Insurance Protects Against
    Tech E&O insurance covers both liability and property loss exposures. Liabilities include losses resulting from technology services, technology products, media content, and network security breaches. Property insuring agreements provide coverage for extortion threats, crisis management expenses, and business interruptions.
  3. Who Cyber and Privacy Insurance Covers
    Cyber and privacy insurance is designed to cover consumers of technology services or products.
  4. What Cyber and Privacy Insurance Protects Against
    This policy is intended to cover liability and property losses resulting from electronic activities, such as selling on the internet or electronic data collection within a company’s internal network. Notably, cyber and privacy insurance will cover liability for a data breach which results in stolen personal information. Data breaches are particularly disastrous due to the many associated expenses, such as notification and credit monitoring costs, costs to defend against claims by state regulators, fines and penalties.

For more information on these policies, please feel free to reach out to our cyber security coverage expert Brian Kilcoyne, CIC. He is reachable by phone at (617)612-6515, or by email at briankilcoyne@hkinsurance.com.

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