Insurance for SaaS Companies

General Liability Insurance: Covers basic risks such as customer injuries at your office or damage to client property.

• Importance: Crucial for covering legal fees and medical costs resulting from accidents.
• Coverage: Legal fees, medical expenses, and settlements related to accidents involving non-employees on your premises.
• Best for: Customer bodily injuries, damaged customer property, libel, and advertising injuries.

Technology Errors and Omissions Insurance (E&O): Protects against lawsuits related to problems with your SaaS solutions, such as service outages or lost data.

• Importance: Shields your business from claims related to service downtime and functionality issues.
• Coverage: Legal costs, settlements, and damages related to service disruptions and contractual misrepresentation.
• Best for: Service downtime, functionality issues, and contract disputes.

Workers’ Compensation Insurance: Covers employee injuries and illnesses related to work, and is mandatory in most states.

• Importance: Protects employees and sole proprietors from work-related injuries.
• Coverage: Medical expenses, rehabilitation costs, and lost wages.
• Best for: Employee medical expenses, disability benefits, and legal costs from lawsuits.

Commercial Auto Insurance: Covers vehicles used for business purposes, protecting against accidents and damage.

• Importance: Essential if your business involves using vehicles.
• Coverage: Collision repair costs, medical expenses, and liability for injuries caused to others.
• Best for: Physical damage, collision coverage, and vehicle repairs.

Cyber Insurance: Covers financial losses from cyberattacks and data breaches, making it essential for any SaaS business handling personal information.

• Importance: Protects against the financial impact of data breaches and cyberattacks.
• Coverage: Customer notification expenses, fraud monitoring services, and other cyber-related costs.
• Best for: Data breaches, cyberattacks, and recovery costs.

Fidelity Bonds: Provide compensation if an employee steals from your business or clients, sometimes called employee dishonesty bonds or crime insurance.

• Importance: Ensures financial protection against employee theft and fraud.
• Coverage: Compensation for losses due to employee theft, unlawful data access, or illegal funds transfer.
• Best for: Employee theft, fraud, and unlawful data access.

Depending on your business needs, consider these additional coverages:

• Commercial Umbrella Insurance: Provides additional liability coverage beyond standard policies.