App Developer Insurance: Quotes From Only $5

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App development is a fast-paced, fun, and exciting profession and occupation. Statistics show that an average of 6,140 new mobile phone apps are released daily on Google Play Store. Similarly, around 3 million apps are available for download from the same platform. This means there are no signs of slowing down in the app development industry, only the other way around.

As an app developer, you know the stiff competition in the industry. The risks and exposures are also plenty, making it necessary to insure your app development venture. For example, your equipment might break down and needs to be taken to the electronic shop for repairs.

Also, like any other business, app development faces serious legal issues that could lead to financial losses. By having app developer insurance, you can easily solve such problems. Below, we will discuss the crucial details about insurance for app developers and why you should get it, as well as costs.

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What is App Developer Insurance?

Besides knowing the cost of app developers insurance, you need to know what it covers and its importance to be able to select the best policy for your business. Therefore, app development insurance coverage protects app developers from any liabilities that could occur while delivering a mobile app to their clients. As a professional app developer, you know the risks surrounding this process. 

Whether you are developing an app for a wide range of devices or a specific one, there are possibilities for errors. Therefore, having professional liability insurance will protect your business but you need insurance coverage that will broadly protect you from all of the risks involved with your business operation. And that might be general liability insurance.

As an app developer, it is your responsibility to ensure that you meet your client's needs by developing high-quality apps. All your products should be robust and deliver as expected. Mobile app developer insurance is meant to protect you from any of these risks while you develop and deliver your mobile app services. App developer insurance protects you from a wide range of claims, preventing unnecessary expenses.

App Developer Liability Insurance

Generally, app developer liability insurance protects against claims against app development businesses.  Insurance companies offer three kinds of liability insurance for app developers:

• General liability

• Professional Liability (also known as errors and omissions insurance)

• Cyber liability

General Liability Insurance for App Developers

Most app developers don't interact with their clients physically. In fact, a majority of them don't have offices and run their multi-million business from their living room! However, this doesn't rule out the risk of costly claims from third parties.

On the day your client decides to show up in your humble office, he accidentally trips over the large hip of wires and severely injures his ankle. If the client decides to sue you and wins the case, not only will you spend money on attorney fees but also on compensation for pain, suffering, and punitive damages. General liability coverage in application developer insurance pays for everything so that you don’t lose money. 

General liability insurance, also included in IT contractor insurance bundles, doesn’t only cover the personal injuries of a client in which you’re at fault. This policy will also cover property-damage claims. Again, the function is similar. If someone files a property damage claim against you, general liability will pay for defense costs and settlements. 

Are you worried about other claims aside from those because of personal injury or property damage? If that’s the case, you can upgrade general liability insurance by adding the following optional IT business insurance policies:

• Advertising injury coverage

• Rented premises liability coverage

When your app development business runs an ad that potentially invades the privacy of your clients, they could file a claim against you. For instance, when you accidentally reveal your client's private information in an advertisement, you could face a costly lawsuit. This is why you need to add an advertising injury cover to the general liability coverage of your app dev insurance policy that protects your business against such a claim. By doing so, you prevent the risk of financial losses.

How about rented premises liability coverage? What’s the use of this if added to general liability insurance?

Rented premises liability coverage is extremely useful if you’re renting someone’s space and using it as an app development office. Even if you’re not the owner, you’re responsible if something happens to that commercial space. The job of rented premises liability coverage is to reimburse the property owner if the space you’re renting gets damaged or destroyed.

Cyber Liability Insurance for App Developers

In the world of app and software development, cybersecurity is extremely essential. For instance, a large company comes to you and requests that you set up a payment portal on their website, which holds sensitive details. Any hacker could be interested in such information, increasing the risk of a security breach. In some cases, the hackers may successfully hack the system no matter how tough your security protocols are. This could lead to the client filing a claim against you. It is important to note that lawsuits involving data breaches are extremely expensive and could cost hundreds or thousands of dollars. If you lose the case, you could go bankrupt. Cyber liability insurance policy helps pay for all or part of the settlement as well as the legal fees. 

Related: 

• Web Developer Insurance

Errors and Omissions (E&O) Insurance for App Developers

No matter how skilled and experienced you are as an app developer, you can still make mistakes. When you make such mistakes, an E&O insurance policy is there to protect you. For instance, when you make a serious mistake when developing an app that ends up affecting your client, they could sue you for damages. Furthermore, some clients could claim you made a mistake in the app even when you know you did the right thing.

As a professional app developer, you are expected to deliver exactly what your client wants, and things don't always turn out like that. This is why you need an E&O insurance policy that protects you against such damaging claims. This policy also helps keep your business reputation intact. >

Commercial Auto Insurance for App Developers 

You might be a mobile app developer digitally nomading with your van or camping trailer around the country while working. When your vehicle runs into another car, the victim could file a claim against your business. You will have to cover the medical expenses and all the repairs. This could be costly, especially if you are getting the money out of your pocket. You can avoid that by getting comprehensive mobile app developer insurance coverage like commercial auto insurance. 

Commercial auto policy found in most comprehensive application developer insurance coverage won’t only kick in if you’re at fault for a vehicular accident.  It will also help if your vehicle gets damaged or experiences issues during a trip. 

Physical damage coverage is inclusion in commercial auto insurance for app developers. It has two forms - collision and comprehensive. 

Collision physical damage coverage will take care of parts repair and replacements costs if your vehicle crashed into another vehicle, got involved in an accident caused by another driver, or collided with an object on the road resulting in damage. 

On the other hand, comprehensive physical damage coverage will take care of parts repair or replacement costs if your vehicle got damaged because of fire, theft, vandalism, hail, storm, and other covered perils. Comprehensive and collision physical damage coverage work hand in hand to ensure that your car goes back to looking new and presentable after something bad happened. 

Something might interrupt your journey - car overheating, malfunctioning battery, busted tires, faulty braking system, or running out of gas. Emergency roadside assistance will be useful for these things. In practice, what this inclusion does is reimburse what you spent for towing, battery delivery and replacement,  gas delivery, and other emergency roadside assistance services.

Application Development Company Insurance

Application development companies decide to get the following insurance policies aside from general liability, errors and omissions, and cyber liability insurance:

• Commercial property insurance

• Workers compensation insurance

• Business interruption insurance

Commercial Property Insurance

Commercial property insurance protects your app development company’s building from perils such as fire, vandalism, theft, extreme weather, and others. If a covered peril completely destroys or damages the building, commercial property insurance will pay for repair or reconstruction expenses. 

There are two types of commercial property insurance  - cash value and replacement value. How much money you can get depends on which one covers your building. 

Commercial property insurance provides money equal to the current market value of your app development firm’s building. This one will pay reconstruction or repair expenses but doesn’t provide complete coverage - meaning that there might be excess amounts you’ll pay yourself. 

Replacement value commercial property insurance, on the other hand, provides money equal to the projected reconstruction or repair expenses. In other words, this one doesn’t allow any room for excess.

Aside from your app development company’s building, commercial property insurance takes care of all the equipment and tools inside. Commercial property insurance has business equipment and tools coverage that reimburses your losses if computers, servers, and other items considered as tools and equipment get damaged because of fire, vandalism, theft, extreme weather, and other covered perils.

Workers Compensation Insurance 

Your app development company certainly has employees. For example, if you’re just starting, workers might be any of the following - UX designer, iOS developer, android developer, back end developer, and quality assurance specialist. 

Working with computers for long periods can strain the eyes. Also, just like the majority of people working for app development companies, your employees might suffer from carpal tunnel syndrome, repetitive strain injuries, chronic back pain, etc. 

Sometimes, injuries become so severe that an employee needs to get treatment and take a pause from working in order to heal. You better be prepared for the expenses if this happens. As the employer, you’re responsible for getting the employee treated, rehabilitated, and get compensated for lost income. 

If you’re worried about spending a lot of money,  purchase workers compensation insurance. Workers compensation insurance functions to cover expenses for employee treatment, hospitalization, and rehabilitation you would have paid. Also, if the employee can’t work for a while, workers compensation insurance will provide an allowance equal to two-thirds of the employee’s average weekly wage. The employee will receive this allowance for 3 - 7 years. 

When Does Your Business Need Workers Compensation Insurance?

When to get workers compensation insurance depends on where your business is located. Here are a few examples so that this is clear:

• Virginia  - App development companies must get workers compensation insurance as soon as there are three or more employees. Virginia workers comp law prohibits employees from suing employers covered with workers compensation insurance

• Montana  - App development companies must get workers compensation insurance even if there’s only one employee

• Illinois - App development companies must get workers compensation insurance even if there’s only one employee

• Colorado - App development companies having one or more employees must get workers compensation insurance. Family members are considered employees

• Utah - App development companies need to get workers comp as soon as there are one or more employees. However, this rule has a few exceptions. App development companies that only have directors and officers don’t need to get workers compensation insurance so long as such directors and officers aren’t more than 5

Business Interruption Insurance

Unexpected events might force you to close your app development company for days or months. This is very problematic as there are still operational costs to pay. Paying for operational costs while income isn’t generated will eventually result in losses. Get business interruption insurance if you don’t want this to happen. 

Business interruption will supplement your app development company’s lost income. The amount of money you’ll receive is hard to determine as there are a lot of factors that come into play. But one thing’s for sure, you can use the insurance money from business interruption insurance to pay for wages, loans, rent (if applicable), taxes, and other operational costs. 

App Developer Business Owner's Policy (BOP)

This is a unique app development insurance policy that you should consider getting. This packaged policy covers liability, property, and business income along with other important areas that you may add to it. While you might not have a large building where your business is based, you need to protect your server room from cases of fires or theft. If your server room is in your garage, do not be mistaken that your garage insurance cover will fully cover the loss if you had not disclosed that you turned it into a server room. This is why it is crucial to get app developer insurance.

App Developer Insurance Cost

The average application developer insurance cost is $30 per month and $360 per year for a $1 million general liability coverage. However, this price could change depending on several factors. For instance, the type of app you develop could determine app developer insurance cost; popular apps with high download potential need higher insurance packages.

Furthermore, the size of your app development business plays an essential role in determining the cost of your policy. If you have a large team of developers, you could spend more on app development insurance. In addition, the type of insurance policy you want determines the total cost as well as the coverage limits. A comprehensive insurance policy will naturally cost more than a standard one.

To get a better idea about how much you’ll pay for premiums, we’ve made a table showing the pricing of the best app developer insurance companies. Read the short review below if you want to know what these carriers have in store.