Technology Liability Insurance Package for NZCS Members
The NZCS, in conjunction with Wilkinson Insurance Brokers and Lumley General Insurance, provides NZCS members with an exclusive insurance arrangement for a Technology Liability package that is extremely competitive on cost and has a very simple online proposal process.
The liability package is specifically designed for small IT companies and IT contractors, who carry a large potential liability exposure.
In today’s business environment significant dollars are spent to create, maintain, and improve networks and distribution of products and services. With this expectation is a greater call for IT professionals to be held responsible for their services and products, and therefore many prospective customers, clients, employers and recruitment agencies, require you to carry “Indemnity” Insurance if you are to work for them.
You are covered for Acts, Errors or Omissions (Indemnity) that result in a financial loss caused by the products and services that you provide to your customers or clients as well as the defence costs to defend against these allegations. Furthermore, you are also covered for Personal Injury or Property Damage (General Indemnity) caused by your product and your services as well as any innocent breach of most statutes of parliament (Statutory Liability). Legal defence costs alone from IT lawyers can cost in excess of $650 + GST per hour.
Examples of some covered losses - accidental loss of data; failure to provide adequate virus protection or download the latest virus protection; failure of the product supplied to perform properly; failed hardware and software integration and installation; accidental physical damage to property and bodily injury to persons whilst in the performance of your business or from your products.
The policy is primarily directed towards IT contractors – people who are providing professional services in the IT industry, however the policy is flexible and can be customised to meet almost all types of IT activities and IT companies.
Faults in a computer operating system lead to data loss
An insured “company” was contracted to provide a replacement computer operating system for one of its customers and for their support staff team. The system was designed to flag data tapes that needed to be saved, stored or reused. The system failed, and data was recorded over previous data, resulting in the loss of important information.
The insurer used a technology expert who arrived at a solution by bringing in a data recovery retrieval expert who worked around the clock to reconstruct and rebuild the files. The insurer made an indemnity payment to the claimant and paid the expenses for the retrieval expert.
Consequentual Loss
An insured “company” sold hardware and software to a customer. Three months after purchasing the computer system the customer claimed that the system didn’t work. They wanted a refund. The dispute was not resolved immediately, and the claim escalated. Eventually the aggrieved party alleged consequential loss, which included loss of income, market share, payroll costs and other expenses. The claim was settled for in excess of $800,000.
An IT “company” had allegations levelled against it by one of its customers.
The customer claimed the product supplied failed to perform, and that they received no service support to help them deal with the situation. It was revealed that the customer’s staff attempted to use the product on hardware for which the system software wasn’t designed.
The customer sued for a refund of the money already paid and for loss of income. The insurer helped their client to defend the allegations, demonstrating that they had fulfilled their part of the obligation and did not oversell their product. The claim was successfully defended, but at considerable cost.
The standard package of $1,000,000 Tech Indemnity (Errors & Omissions) excess $2,500, $1,000,000 Tech General Indemnity (Public Liability) excess $500 and $500,000 Statutory Liability excess $500 costs:- IT Company / IT Contractor - Turnover up to $250,000 per annum costs from $600 + GST per annum for Fellows and Full Members; for Associate or Affiliate Members the premium is from $700 + GST per annum.
IT Company / IT Contractor – Turnover $250,000 to $500,000 per annum costs from $1,200 + GST per annum for Fellows and Full Members; for Associate or Affiliate Members the premium is from $1,300 + GST per annum.
Tailored packages can be provided for members with Sum Insured and/or turnover levels greater than the above. The aim is to provide members with critical insurance protection whilst keeping the premiums as economical as possible.
Typically for turnovers up to $250,000 it can cost $2,000 to $3,000 + GST (or higher) per annum, and premiums are even higher for the larger turnovers.
The NZCS plan could save you a significant amount on your insurance and it doesn't cost anything to get a quote (see Contact Details below).
If you are a member of the Society (Affiliate, Associate, Member or Fellow) you are eligible to apply for insurance through the scheme (a higher premium applies for affiliates and associates - see below).
If your company has 5 or fewer staff and all key senior staff are members of the Society, the entire organisation is eligible to access insurance under this package.
If your company has more than 5 staff, and the company is a Corporate Partner of the Society, it is also eligible.
For an online quotation or additional information please either e-mail Wilkinson Insurance Brokers on nzcs@wilkinsons.co.nz or call Wilkinson Insurance Brokers on 0800 801 422 and ask to speak to one of the NZCS broker team.