Comprehensive Insurance Coverage for Managed IT Service Providers in San Diego
H&M Agency: Providing Specialized Insurance Plans Designed for MSPs
Herriott & Mijailovic is an independent agency specializing in business insurance for large and small managed IT service providers in San Diego. Insurance is pivotal in IT because clients depend on your services to run their business. However, with so many insurance options available for the IT and technology sector, it can be difficult to identify which coverage offers maximum protection. For this reason, turn to professional agents like us. H&M offers comprehensive insurance packages designed especially for MSP firms, including general liability coverage, business owner’s policy (BOP), cyber liability insurance, commercial umbrella, professional liability (errors & omissions), workers compensation, commercial auto, etc.
Our insurance experts will find the right coverage, specific to your needs and unique business model. Subsequently, you will have peace of mind and confidence knowing you are fully shielded from important industry hazards such as financial losses due to cyber-attacks, legal fees, hefty settlements, and other possible risks. We are licensed to sell insurance products from various top insurers nationwide, like CIG, Travelers, The Hartford, Progressive, Safeco, Nationwide, etc. Today is the perfect time to look into this matter and protect your MSP company. For more insights about MSP insurance, call us at (619) 296-0005 or fill out a quick contact form.
Why Insurance Is Crucial for MSP Businesses
Business digitization is quickly expanding across the world. The IT work environment is rapidly growing and the majority of companies today rely on third-party providers (MSPs) to manage day-to-day operations of their IT network, including defense against cyberattacks, network support, cloud computing, data storage management, end users, etc. If you provide managed IT services, your customers depend solely on you to operate their digital infrastructure. However, if something ceases to function, you could be held accountable. A client could sue you for downtime or data breach, and for this reason you should obtain coverage for these situations.
According to IBM’s survey, average cost of data breach is over $4 million dollars on a global level, while only a small percentage of companies has coverage for the whole amount. Because of this, it is of utmost importance to purchase a policy which will help you run your business without interruptions.
With such a variety of services offered and the dynamics of the technology development, liability risks are becoming even more sophisticated, particularly as data becomes prevalent. MSP firms are facing a lot of risks that could cause financial losses. To prevent this scenario from happening, most companies tend to purchase only the basic type of insurance, like general liability. However, this coverage alone does not offer adequate protection. Because MSPs handle numerous digital interfaces, the right coverage package should encompass several different policies based on each client’s necessities.
Choosing The Right Insurance for The Providers of Managed IT Services
The ideal coverage for MSPs includes a combination of various policies, all bundled into one package that offers the highest level of safety.
MSP insurance policies are customized according to each client’s needs. There is no one-size-fits-all rule, and the best coverage encompasses different policies that cover various events.
When it comes to choosing the right policy, many business owners are not aware that general liability (GL) and Errors & Omissions policy are not the same. While general liability covers actual threats, an E&O policy covers more presumed risks.
Hence, you should speak to MSP insurance experts. H&M licensed agents will create perfect protection plan for your growing business so you can have a worry-free lifestyle. Based on your requests, we will put together specific policies into a unique coverage bundle that is the most fitting solution for your needs.
Below is a list of policies that cover the most common risks faced by managed IT service providers.
General liability insurance
General liability insurance, also known as “all-risk policy”, offers wide protection against some of the most common risks in work environment, such as bodily injury on property or personal property damage. It safeguards your tech company from the financial shortfalls of lawsuits by helping you pay for the legal costs and fees. It also enables you to be eligible for leases and contracts, as many companies who are contracting vendors require at least this type of policy before proceeding with contract signing.
Cyber liability insurance
Cyber insurance is an all-inclusive policy that helps MSPs overcome the difficulties caused by various cyber-crimes, such as data breach of sensitive client information (social security numbers, credit card numbers, or health records). The purpose of this policy is to help you recover faster after the digital attack imposed on you. Cyber liability insurance helps pay for legal expenses, fines, lost income, recovery expenses, and other related costs.
Professional liability (Errors & Omissions)
Professional liability (Errors & Omissions, E&O insurance) is intended to help MSP companies survive third-party or client lawsuits claiming inadequate services or performance. E&O insurance offers financial aid in paying the cost of legal proceedings in situations such as failure to deliver services promised, work errors, oversights, omissions, negligence accusations, violation of work standards, and similar claims.
Business owner’s policy (BOP)
You could also opt for business owner’s insurance that encompasses three different coverages put together into a single policy. It includes general liability, property and business interruption insurance. BOP safeguards small-to-medium-sized MSPs against accidental risks, such as personal injury, property damage, crime protection, electronic data liability, etc.
Workers compensation
Workers compensation insurance is mandatory in California. It serves to provide protection for both employers and employees. When employees are injured at work, employers are held responsible and must pay for the medical costs and lost wages. Workers compensation policy helps pay expenses related to work injuries (disability benefits, lawsuits, medical bills) while maintaining smooth business operations.
Commercial umbrella insurance
Commercial umbrella policy is critical for uninterrupted business growth, as it provides coverage beyond the basic inclusions and incorporates slip and fall accidents, third-party property damage, car accident liability, etc. Commercial umbrella also helps pay for expensive legal fees, settlements, medical bills, etc.
Commercial auto
Whether you use just one or more vehicles for your managed IT service business, you should ensure you acquire commercial auto insurance for all of them. Most states require this policy for the vehicles you use for business. Commercial auto insurance policy typically includes physical damages, liability, and other coverages, such as medical expenses, towing, rental reimbursement, etc.
Commercial property
Securing commercial property policy is valuable for businesses of all sizes – small, midsized, and large. It shields your business by covering the premises and physical assets inside (equipment, furniture, computers, tools, etc.). IT industry deals with some of the highest-priced equipment and data, thus risking expensive replacements in case accidents happen. Because of this, it is a wise decision to purchase commercial property coverage, which will help replace damaged or stolen computer equipment.
Which Tech Companies Should Get This Coverage
With fast development of the IT sector, there are lots of MSP companies that should obtain appropriate coverage. If you provide any of the services mentioned below, you should secure yourself, your business, and your employees:
- Complete managed IT
- Cyber security services
- Cloud computing
- Network design & management
- IT consulting
- Field tech support
- Remote computer support
- Data management (data analysis, data science, data architecture)
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What Risks Do MSP Companies Face?
Running an MSP business means being exposed to a wide range of risks and vulnerabilities, including, but not limited to:
- Cyber-crime: Some of the most common cyber-attacks includephishing, compromised devices, ransomware, service denial, malware, SQL injection, cross-sit scripting, etc.
- Downtime: If the network fails, your client will not be able to operate successfully. They might lose not only potential income, but also their customers. There are risks of both financial and reputational disaster.
- Compliance with regulations: MSPs have to be up-to-date with security regulations and data privacy laws since they handle sensitive data.
Why Choose H&M Insurance Agency
Herriott & Mijailovic is a respectable insurance agency from San Diego that takes the knowledge accumulated over decades of involvement in insurance industry and utilize it to offer maximum protection for businesses in San Diego. We are committed to enhancing insurance coverage while reducing negative impacts and financial losses due to business risks.
What sets us apart from the competition:
- 5 decades of industry presence
- Specializing in business insurance & local California market
- Boutique-style, highly personalized service
- FREE initial consultation
- Most comprehensive coverages at affordable rates
- Partners with major insurance carriers (First Comp, First American, Employers, Travelers, etc.)
What Our MSP Clients Say About Us
We’ve been with H&M Insurance since 2007 for all our insurance needs. In the past 10 years as we engaged in business they’ve been our one-stop for workers comp, general liability, commercial auto and E&O. With that said we had auto insurance claim that’s been handled professionally and timely. Goran is very knowledgeable and his advice is always highly appreciated. – Val, Secure Network ITC
You Have Questions About MSP Insurance Coverage? We Have the Answers!
The cost of MSP policy is determined based on multiple elements, including the size of the company and where it stands in its process of business growth. Other important factors that impact the price of insurance involve exposure (risks to be insured), company business practices (safety approach, risk management), business revenue, deductibles, claims history, etc. For more information on the prices, contact our office directly.
If you are wondering how to cut the cost of your MSP policy, we can help. Below, we have listed four ways cut insurance costs:
- Shop around – Either get quotes from several insurance suppliers or speak to an independent insurance agent. Independent agents work with every major insurer and will shop around for the best price.
- Bundle coverages – Tying policies together in a bundle can often lower the total price. Some of the most frequent packages are the business owner’s policy (BOP) and Errors & Omissions policy.
- Annual premium payment – Paying the premium annually instead of monthly It typically costs less money to pay the amount for the whole year in one payment than to pay in monthly installments.
- Reduce the risks – Whenever you can, try to reduce your risks. By employing risk management you will be able to avoid increased premiums and high-priced claims.
There are two different kinds of cyber liability insurance, and both of them are equally significant for the providers of managed IT services:
- First-party liability insurance: Protects against cyber-crime that affects your business directly. If you offer PII (personally identifiable information) database management services for your clients, this coverage is essential for your business. First-party cyber policy helps cover the cost of losses caused by data breaches, as well as response costs, business interruption, or extortion demand.
- Third-party liability insurance: This type of policy is ideal for MSPs that are responsible for the management of client’s cybersecurity. It offers financial assistance in paying legal costs in case a client sues you for failing to impede cyber-crimes.
Smaller MSPs face various risks, including cyberattacks and physical damages, which can be mitigated by having appropriate insurance coverage.
Regularly, as part of their business growth strategy and disaster response planning, to ensure adequate coverage for evolving risks.