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Errors & Omissions Policy For Software Companies

What is E & O Policy for Software Industry?
Basically, it is a Liability Package Policy designed especially for Software/IT/ITes Industry to provide protection against all possible liability eventualities. Information and network technology companies are facing greater risks than ever before - especially when it comes to product and service performance. dotched orders… payroll delays… foul-ups in the processing of records… losses of data… failures in delivery… all potentially caused by products or projects that have gone wrong. Getting what's wrong made right means huge expenses and business distractions to project owners, and they are increasingly turning to the courts for remeby. This is Claims Made Policy covering the Legal Liability only.

What are its benefits?
Since Software Companies deal with outside India clientele; including those of from developed countries like USA, UK, Japan etc where awareness level is much higher, necessity of this Insurance is more for these companies. And with increasing development even in India, our awareness level in coming days will be much more; thus making this Policy simply a NECESSITY.
Consider the following scenarios: A Mobile Service Provider company sues for lost revenue and expenses to recover billing files for mobile customers that were deleted by their software vendor who was updating the system. INT Errors and Omissions for Technology Company Policy responds to the suit settlement of INR27,50,000 plus defense costs of INR150,000 under a Policy with Sum Insured of Rs. 01 Crore.
A personal computer assembly company is sued by a group of consumers in a class action suit. The suit alleges that the company's equipment did not live up to advertised specifications. Citing issues such as lack of speed and poor upgrabe capability, they demand full refunds. Errors and Omissions Policy for IT/ITes/Software Companies responds to the suit settlement of INR 11,00,000 plus defence cost of INR 88,000 under a Policy with Sum Insured of Rs. 50 Lacs.

Who it is for?
This Policy should be taken by all these Companies - Software Developers (Financial /Accounting, Business systems, e-Commerce, Asset/Inventory Management, etc.) Hardware designer/manufacturer/importer, Telecommunication service provider, Data communication service provider (ISP), Data processing/warehouse service provider, Computer/IT Consultation etc.

Approximate Cost of this Insurance?
Being a Re-insurance driven Policy, the rates are as per international market and no generic idea can be given. Furthermore, considering its complex nature, various information inputs are needed to assess the risk and rate the premium. Very roughly, Rs. 10,000/- to Rs.30,000/- is needed to have a Policy for Rs.01 Crs.

Claim procedure of this Insurance?
Like any other Liability Policy, it is a Claim Made Basis Policy for the legal liability to be satisfied on behalf of the Insured under the Policy terms and conditions.