Information technology insurance refers to insurance coverage that protects a business against losses due to information technology related mishaps. Many companies store massive amount of company data and other important information on computers. The theft or destruction of this data as well as software failure or security breaches and other errors can lead to substantial losses, hence the need for information technology insurance.
As information technology has advanced, it has become increasingly more important for businesses. Many rely on it to conduct large parts of their operations. This means that if something goes wrong with a company's information technology, it can be exposed to severe losses. For example, if an online stock broker experiences a system crash, millions of dollars could be lost. Information technology insurance can hedge against these and other losses related to information technology such as errors and omissions, media liability, and privacy.
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