Technology Errors & Omissions (Tech E&O)
Tech E&O is third-party liability coverage that responds when a client alleges your software, API, platform, or professional services failed and caused them financial harm — an outage, a bug, a missed integration, or output your product got wrong.
Tech E&O for SaaS Companies
If your company builds software, hosts a platform, or delivers technology-enabled services, technology errors & omissions insurance is the policy that responds when a customer says your product failed them financially. It is a professional liability policy purpose-built for technology work, distinct from the general liability most businesses default to.
What Tech E&O Covers
- Software failures: A bug, outage, or defect that keeps a customer from using your product as promised
- Missed integrations: A failed API connection or data-sync error that disrupts a client's operations
- Bad output or calculations: Your software returns incorrect results a client relied on for a business decision
- Failure to deliver: Contracted implementation, customization, or professional services that were not completed as promised
- Legal defense costs: Attorney fees and court costs to defend a claim, even if it turns out to be groundless
- Settlements & judgments: Up to your policy limits
Tech E&O vs. Cyber Liability
The simplest way to separate the two: Tech E&O responds to performance failures, cyber liability responds to security failures. If your platform goes down and a client loses revenue because of a bug, that is a Tech E&O claim. If an attacker breaches your systems and steals customer data, that is a cyber liability claim. Many incidents touch both — a breach that also knocks your service offline can trigger claims under each policy — which is why most software companies carry both rather than choosing one.
Why Contracts Increasingly Require It
Enterprise customers, resellers, and platform partners routinely write minimum Tech E&O limits into their master service agreements before they'll sign. Security and vendor-risk questionnaires from enterprise buyers frequently ask for proof of this coverage alongside SOC 2 documentation. Carrying adequate limits keeps you able to say yes to larger deals instead of losing them at the contract-review stage.
What's Covered
Frequently Asked Questions
What is Tech E&O insurance and do we need it as a SaaS company?
Tech E&O (technology errors & omissions) covers claims that your software, platform, or technology services caused a client financial loss — an outage, a bug, or a failed integration. If your company builds or operates software that customers depend on for their own business, this is typically the first liability policy to put in place, often before general liability matters much.
Is Tech E&O the same as general liability?
No. General liability covers third-party bodily injury and property damage — largely irrelevant to a remote software company with no physical job sites. Tech E&O covers the financial-harm claims that actually come up for software businesses: a client alleging your product failed and cost them money.