Cyber Liability Insurance vs. Tech E&O: What's the Difference and Do You Need Both?

Cyber liability insurance protects your own business against the costs of a data breach or network security incident affecting your systems or data, breach response, notification costs, forensics, ransomware and extortion, and business interruption while systems are down.

Technology errors and omissions (Tech E&O) insurance is a professional liability policy for technology companies. It responds when a client alleges that your product or service, the technology you built or sold, caused them financial harm through an error, failure, or negligent act.

The two can overlap in a single incident. If a software bug leads to a data breach, that scenario could trigger cyber coverage, if it's your own systems that were exposed, and Tech E&O, if it's your product's failure that harmed a client. That overlap is exactly why carriers often combine or closely coordinate the two forms for technology companies.

SaaS companies, IT service providers, managed service providers, and software developers are the businesses that most commonly need both. Any technology vendor whose product handles client data or is integral to a client's operations faces a realistic chance of both scenarios: causing a client financial harm, and having its own systems breached.

Machaen Insurance Agency places cyber liability and Tech E&O together for technology companies so there isn't a coverage gap sitting in the space between the two forms.

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