If you write code for a living, Technology Errors & Omissions (Tech E&O) insurance is the single most important policy you can own. And yet, most developers either don't have it, think their general liability covers them, or bought a policy so riddled with tech exclusions that it won't pay a cent.
This guide covers everything you need to know.
What is Tech E&O Insurance?
Tech E&O (also called Technology Professional Liability) covers financial losses caused by mistakes, oversights, or failures in your professional work as a software developer, IT consultant, or tech agency.
When your code has a bug that crashes a client's production system, Tech E&O pays for the legal defense and any settlement or judgment. When a deliverable doesn't meet spec and the client sues for damages, Tech E&O responds.
Without it, you're personally liable — and so is your LLC if it's undercapitalized.
What Tech E&O Actually Covers
The coverage details vary by carrier, but a well-written Tech E&O policy covers:
- Coding errors that cause production downtime or data loss
- Missed deadlines that result in documented client financial losses
- Scope disputes where the client claims your work didn't meet the agreed spec
- Negligence in consulting — bad advice that led to financial harm
- Defense costs even if the claim is completely frivolous
That last point matters. Even if you're right, legal defense in a tech professional liability case often costs $50,000–$200,000. The policy pays that regardless of outcome.
What Tech E&O Does NOT Cover
- Intentional misconduct or fraud
- Bodily injury or property damage (that's GL)
- Data breaches and cyber incidents (that's Cyber Liability)
- Employment claims (that's EPLI)
- Patent infringement in some policies (check exclusions carefully)
This is why most tech professionals need both Tech E&O and Cyber Liability. They cover separate risks.
How Much Does Tech E&O Cost?
Here's a realistic range based on what we place:
Freelance Developers (solo): - $700 – $1,200/year for $1M/$2M limits - $1,000 – $1,800/year for $2M/$4M limits
Development Agencies (5–20 employees): - $2,500 – $6,000/year for standard limits - Higher for specialized work (fintech, healthcare, defense)
SaaS Startups: - Priced on ARR and exposure — often $3,000–$10,000+/year
Factors that increase your premium: healthcare or financial sector clients, very large single-client contracts, international clients, and prior claims.
Claims-Made vs. Occurrence: The Critical Difference
Tech E&O is almost always claims-made coverage. This means the policy in force when the claim is filed pays — not the policy active when the work was done.
Why this matters:
- If you did work in 2023, let your policy lapse in 2024, and the client sues in 2025 — no coverage.
- If you switch carriers, you need a "tail" policy or retroactive date to cover prior work.
Always ask about your retroactive date (the earliest work date covered) and never let your Tech E&O lapse without tail coverage or a replacement policy with a matching retro date.
Enterprise Client Requirements
Enterprise and government clients increasingly require proof of Tech E&O coverage before signing contracts. Common requirements:
- $1M per occurrence / $2M aggregate (standard enterprise minimum)
- $2M per occurrence / $4M aggregate (large enterprise, healthcare, finance)
- $5M+ (Fortune 500, government prime contracts)
- Named insured with client as additional insured
We issue certificates of insurance same business day. If a contract requirement doesn't match your current limits, we can often bind an endorsement within hours.
The Biggest Mistake Developers Make
Assuming your LLC protects you. An LLC protects personal assets up to its capitalization. If your LLC has $10,000 in it and a client wins a $500,000 judgment, you'll experience "piercing the corporate veil" firsthand.
Tech E&O insurance is the actual protection. The LLC is just the vehicle.
Getting Covered
The process is straightforward: you fill out an application (we have a streamlined tech-specific version), we match you to the right carrier, and you get a quote same-day. Most solo developers can bind coverage in under 24 hours.
Don't wait until a client demands proof of insurance. Get covered now, before you need it.