Internet Business Insurance Policy Information

Internet Business Insurance. Conducting business on the internet can be very lucrative, but many people go into internet businesses with the false notion that they don't need the same standard insurance coverage that traditional brick-and-mortar businesses require.
The truth is that although the internet has changed the way that we do business, protecting an internet business is as essential as protecting a traditional brink-and-mortar business.
The internet has revolutionized the way we do business; prior to the advent of the internet, businesses needed a physical location to conduct business. Today's businesses often begin with simply an idea about how to make money, a good business plan, and a web presence. That is where internet business insurance comes in.
Customers now shop, bank and perform other simple errands on the internet, and they are turning to the internet to help them do product research as an alternative to shopping around. Around 40 percent of smartphone owners in the United States compare prices on products they need while they are shopping.
Internet business insurance protects your online business from lawsuits with rates as low as $27/mo. Get a fast quote and your certificate of insurance now.
Below are some answers to commonly asked internet business insurance questions:
- What Is Internet Business Insurance?
- How Much Does Internet Business Insurance Cost?
- Why Do Internet Businesses Need Insurance?
- How Does Internet Business Insurance Work?
- What Does Internet Business Insurance Cover & Pay For?
What Is Internet Business Insurance?
Internet Business Insurance is a type of insurance policy that protects a business that operates solely or primarily online from financial losses resulting from a range of risks and hazards. These risks may include cyber attacks, hacking, data breaches, theft of intellectual property, and other online security threats.
The insurance coverage may also include protection against liability claims, loss of income, and other losses resulting from online business operations. The coverage and protection offered by Internet Business Insurance vary depending on the type of policy and the specific needs of the business.
How Much Does Internet Business Insurance Cost?
The average price of a standard $1,000,000/$2,000,000 General Liability Insurance policy for small internet businesses ranges from $27 to $59 per month based on location, type of good sold, sales and experience.
Why Do Internet Businesses Need Insurance?

While owning an internet-based business cuts your overhead, there are still inherent risks for IT companies and their owners. A large portion of them face consolidation and competition, many of them fail to market and develop new products, and a big number of them face intellectual property infringement.
Operation of an IT business or any internet-related business puts you at specific risks that may not be an issue in a regular brick-and-mortar location. You probably handle digital assets, social media and email, but you may also be privy to sensitive data belonging to other people and companies.
Even if you are operating a web-based business, the laws that apply to trademarks, slander, libel and copyright still apply. This is why you should have internet business insurance.
Some insurance companies hesitate to provide internet companies with internet business insurance due to the liability issues that exist for these businesses. Bear in mind that even a standard business insurance policy is unlike to prove the protection that you will need if your business is ever faced with an accusation of copyright infringement, data loss or breach of data.
Only internet business insurance can afford this protection. Liability insurance for technology companies protects against several perils, including:
- Industrial espionage
- Hacking and liability and cyberspace
- Computer viruses
- Data loss
- Data breaches
- Denial of service or DOS attacks
Many insurance companies face a lack of reliable information about the risks that web-based companies face. New developments are continually evolving that provide benefits to internet-based business and tech companies, and these developments often put these types of businesses at enhanced risk and add to their costs.
Insurance companies typically have no real way to calculate the true potential costs of cyber perils, so they write internet business insurance policies for companies with their own interests in mind.
How Does Internet Business Insurance Work?
Determining your exact risks as the owner of an IT company, tech business or internet-based business can be hard. Launching a business online, whether from an office or your home, involves a number of perils that you would go beyond the norm.
For instance, if you build a website, you have the same liability legally as a magazine or newspaper, although you may not treat the content of the business he same. This is why internet or IT business insurance is so important. Some of the scenarios in which an internet business insurance may help include:
- An employee of your business places an image that is copyrighted onto your homepage without getting the consent of the image's owner.
- A copyright has already been established for the name of your website or business.
- An employee of your online business writes remarks about the competition in a press release or online forum.
- Your site is hacked and your operations are shut down without your control, interrupting business.
- An angry employee manipulates or breaches customer payment info.
Internet business insurance can give your business critical protection and reduce your exposure to financial loss from claims resulting from incidences such as these. You can reduce those risks by conducting security audits to mitigate weaknesses in your server or network.
You can also establish procedures to prevent breaches from hackers by maintaining a firewall and password guidelines. Remote backup storage for your server is also a good way to stave off attacks.
What Does Internet Business Insurance Cover & Pay For?

There are several reasons why internet businesses may face lawsuits, including:
Intellectual Property Infringement: Internet businesses may face lawsuits for copyright, trademark, or patent infringement. For example, if an online retailer sells counterfeit products, they may be sued for trademark infringement. Intellectual property insurance can protect internet businesses by covering legal costs and damages associated with such lawsuits.
Data Breach or Privacy Violation: Internet businesses that handle customer data are at risk of data breaches or privacy violations, which can result in lawsuits. For example, if a social media platform fails to adequately protect user data and suffers a data breach, they may be sued for negligence. Cyber liability insurance can help cover legal costs, notification and credit monitoring services for affected customers, and potential damages.
Defamation or Libel: Internet businesses, particularly those that rely on user-generated content, may face lawsuits for defamation or libel. For example, if an online review platform publishes a defamatory review about a business, the affected business may sue for damages. Media liability insurance can help cover legal costs and damages associated with defamation or libel lawsuits.
Breach of Contract: Internet businesses may face lawsuits for breach of contract, such as failing to deliver goods or services as promised. For example, if an e-commerce platform fails to deliver products to customers as per their purchase agreement, they may be sued for breach of contract. Errors and omissions (E&O) insurance can protect internet businesses by covering legal costs and damages arising from alleged breaches of contract.
Discrimination or Harassment: Internet businesses, including online marketplaces or social media platforms, may face lawsuits related to discrimination or harassment. For example, if an online marketplace refuses to do business with certain sellers based on discriminatory reasons, they may be sued for discrimination. Employment practices liability insurance (EPLI) can help cover legal costs, damages, and settlements associated with discrimination or harassment lawsuits.
In each of these examples, insurance can help internet businesses pay for lawsuits by covering legal defense costs, settlement or judgment amounts, and other related expenses. It is important for internet businesses to carefully review their insurance policies to understand the scope of coverage and ensure that they have adequate insurance protection in place to mitigate potential risks and liabilities. Consulting with a qualified insurance professional can also help internet businesses determine the right insurance coverage for their specific needs.
Commercial Insurance And Business Industry Classification
- SIC CODE: 7371 Computer Programming Services
- NAICS CODE: 541511 Custom Computer Programming Services
- Suggested Workers Compensation Code(s): 8803 Auditor, Accountant, or Computer System Designer or Programmer - Traveling, 8810 Clerical Office Employees NOC
Description for 7371: Computer Programming Services
Division I: Services | Major Group 73: Business Services| Industry Group 737: Computer Programming, Data Processing, And Other Computer Related Services
7371 Computer Programming Services: Establishments primarily engaged in providing computer programming services on a contract or fee basis. Establishments of this industry perform a variety of additional services, such as computer software design and analysis; modifications of custom software; and training in the use of custom software.
- Applications software programming, custom
- Computer code authors
- Computer programming services
- Computer programs or systems software development, custom
- Computer software systems analysis and design, custom
- Computer software writers, free-lance
- Programming services, computer custom
- Software programming, custom
Internet Business Insurance - The Bottom Line
Although your internet business may not be at risk for many of the perils that brick-and-mortar locations experience, the threats are nonetheless real. Choosing a policy that looks at all the ways you can find yourself on the receiving end of litigation can ensure that you're protected.
Discussing your unique business with a trusted agent can help you prepare for the unseen cyber threats that face your business and threaten its success.
Additional Resources For Information Technology & Internet Insurance
Learn about small business IT technology insurance policies that help protect IT businesses, consultants & subcontractors from the unique risks that small tech businesses face when they work.
- Application Development
- Amazon Seller
- Artificial Intelligence
- Computer Electronic Repair
- Computer Programming
- Computer System / Network Developer
- Cyber Liability
- Data Breach
- eBay Sellers
- eCommerce
- Electronic Data Processing
- Electronic Data Processing Equipment
- Internet Business
- Internet Service Provider
- IT Consultant
- Online Store
- Social Media
- Software Developer
- Technology Services
- Telecommunications
- Website Design
- Specialty Computer

The information technology (IT) industry is constantly evolving and adapting to new technologies and trends. It is a critical component of many businesses and organizations, as it helps them to communicate, store data, and operate efficiently. However, the IT industry also faces unique risks and challenges that can lead to financial losses, legal issues, and damage to reputation. This is why it is essential for IT businesses to have commercial insurance to protect their assets and interests.
One of the main risks that IT businesses face is data breaches and cyber attacks. Hackers can gain access to sensitive information stored on a company's servers or systems, leading to data theft, identity theft, and other crimes. Insurance can provide coverage for these types of events, helping IT companies to mitigate the financial and legal consequences.
Another risk that IT businesses face is the possibility of equipment failure or malfunction. This can result in downtime and lost productivity, which can have a significant impact on a company's bottom line. Commercial insurance can help IT businesses to cover the costs of repairs and replacements, as well as any lost revenue or expenses incurred due to the equipment failure.
IT businesses may also face legal issues, such as intellectual property disputes or contract disputes with clients. Insurance can provide coverage for legal fees and damages, helping IT companies to defend their interests and protect their reputation.
Overall, the IT industry needs business insurance to protect against the many risks and challenges it faces. Without adequate coverage, IT businesses may be vulnerable to financial losses and legal issues that could impact their operations and success.
Minimum recommended small business insurance coverage: Business Personal Property, Business Income with Extra Expense, Equipment Breakdown, Computer Fraud, Employee Dishonesty, Accounts Receivable, Computers, Valuable Papers and Records, General Liability, Employee Benefits Liability, Errors and Omissions Liability, Professional Liability, Umbrella Liability, Hired and Nonowned Auto Liability & Workers Compensation.
Other commercial insurance policies to consider: Building, Earthquake, Flood, Real Property Legal Liability, Forgery, Cyber Liability, Employment-related Practices Liability, Directors and Officers Liability, Business Auto Liability and Physical Damage and Stop Gap Liability.