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Insurance for Software Developers

Software developers can be compared to “spec” home builders—they operate in the world of “if we build it, they will buy.” While the computer industry moves very quickly, software can take years to develop. Successful software developers have many projects operating at one time, with the next level being developed even before the first one is launched. Pre-packaged software includes not only business software but also computer games.

Businesses that develop customised software products for their clients are specialised consultants. Their job involves analysing their client’s software needs as well as working closely with the client’s internal computer staff and the end user to develop the final product.

At Business Insurance Service, we understand not just the insurance industry, but the commercial sector too. Our brokers have years of experience and expertise in finding professionals from across all disciplines the right kind of Liability and Professional Indemnity insurance cover for professionals, giving both sole traders, SMEs, and large international agencies the protection they need.

 

What Insurance do Software Developers need?

Minimum recommended cover can usually be arranged on a Professional Indemnity (PI) combined policy to include Buildings, Computer Equipment & General Contents, Increased Expenditure, Employee Dishonesty, Public Liability, Employers’ Liability

Other covers to consider are Cyber Liability, Employment Practices Liability, Commercial Vehicle, Employee Benefits, Directors and Officers Liability, Excess of Loss/Difference in Cover.

Property Insurance

Property exposure for pre packaged software developers centre on the high concentration of electronic equipment. Fire sources could include wiring, wear, and overheating of equipment. Fire, smoke, and water could pose significant damage to equipment. Fire protection should consist of chemical applications instead of water. Increased Expenditure is needed more than Business Interruption because the developer must keep operating if the product is to get to the market in time. The developer should have a disaster plan in place.

Property exposure for customised software developers centre on the high concentration of electronic equipment. Fire sources could include wiring, wear, and overheating of equipment. Fire, smoke, and water could pose significant damage to equipment. Fire protection should consist of chemical applications instead of water. Although computer equipment can be included as part of the Machinery and Contents cover, the more complete cover is under a Computer policy. Increased Expenditure is more the concern for this type of operation than Business Interruption due to contract deadline dates.

Property Liability

Premises liability for pre packaged software developers is minimal since operations are conducted on premises. If the developer runs test markets on premises, the exposure must be evaluated based on the population base and product being tested. If children are used in focus groups for computer games, careful supervision and procedures must be in place. The best situation is for the parents and/guardians to be responsible for their children during the testing. If there is any off-premises testing by the developer, the same precautions must be taken.

Premises liability on the developer’s location is minimal; most customised software developers frequently visit clients so there is regular off-site interaction. The company should have a code of conduct regarding acceptable off-premises behaviour. In addition, if the developer works on the client’s computer, there is the possibility of damaging the client’s hardware or corrupting the code on the client’s existing software.

Crime Insurance

Crime exposure for pre packaged software developers is from Employee Dishonesty and Computer Fraud. Background checks and previous employment verification are important prior to hiring.

Employers’ Liability Insurance

Employers’ liability exposure exists in the areas of ergonomics, repetitive motion and carpal tunnel syndrome. The design of workstations to prevent worker injuries is important.

Products Liability Insurance

Products liability exposure for pre packaged software developers comes from the unintended consequences of the interaction of the developer’s product and the customer’s equipment or other software. Testing, testing and more testing is the necessary loss prevention.

Professional Indemnity Insurance (PI)

Professional indemnity exposures are extensive for software developers who develop customised software. The developer will need to purchase cover for damage that errors in the software might cause. In order to fully evaluate the potential exposure, it is important to obtain a client listing and understand the types of programmes that are being developed. The more essential the software is to the business’s operation, the more serious is the errors and omission exposure, with the possibility of long-term consequences. In addition, it is important to know what the software might control within the business. If the software is designed to provide safety services, the situation might be more serious than in a more mundane project.

What other risks does a Software Developer face?

Other exposure for pre packaged software developers comes in two types. The first is the extensive computer equipment that must be covered by a Computer policy. Software and Increased Expenditure cover is very necessary since the developer must either exert all the efforts that are necessary to keep going after a loss or accept the probability of falling behind the competition. All systems must be regularly backed up and the duplicates kept off premises so that the developer can quickly return to operations after a loss. The second area is Deeds and Documents cover. The developer will have documentation for producing the software, patent and/or copyright information, and contractual relationships that are vital to the continuation of the company. All such paper should be duplicated and the duplicates kept off premises.

Other exposure for software developers who develop customised software starts with the computer. A Computer policy is mandatory since it includes not only the hardware but also the software and the media. The owner must take precautions such as frequent backup and off-site data storage. Since this type of developer works with clients at the client’s premises, Transit and Off-Premises cover is a must. Precautions must be in place to prevent theft. When off premises, the equipment must be kept with the owner or an employee, or in a locked area. Increased Expenditure is an important option to purchase because of the need to quickly return to operation after a loss in order to meet contractual obligations. Information that is used to document the programming that is not software must be insured as Deeds and Documents. All contracts, documentation, software design, copyrights and patents should be duplicated and the duplicates should be kept off site.

Why not discover more about Business Insurance Service? Or simply get in touch with our services today.

How can Business Insurance Service help Software Developers?

Whether you’re a sole trader or a small to large company, your insurance portfolio has to be up to date and provide you and your business with the right level of protection. Rather than trying to find liability or professional indemnity insurance by hunting through countless websites, let us or our website do it for you.

We’re members of the British Insurance Brokers Association (BIBA) and work with some of the largest and best-known insurance providers in the UK, including Lloyds of London for larger, more complex and high-risk customers. We’re fully regulated and committed to delivering a premium quality, trustworthy and reliable service to all our customers, regardless of size.

As preferred brokers working with some of the largest insurance providers in the UK, we have immediate access to a huge range of policies for various businesses, including vets and surgeries. We provide our customers with a bespoke or package service, creating insurance portfolios that are specifically tailored to your individual needs, and your budget.

A fully accredited service delivered by professional brokers

To find out more about insurance for Software Developers call us on 01273 789 979

Email us at hello@businessinsuranceservice.co.uk

Use our Get In Touch form to request a call-back.

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    We’re members of the British Insurance Brokers Association and work with some of the largest and best-known insurance providers in the UK, including Lloyds of London for larger, more complex and high-risk customers. We’re fully regulated and committed to delivering a premium quality, trustworthy and reliable service to all our customers, regardless of size.