16 June 2014 Insurance

New Lloyd’s consortium offers technology E&O

A new consortium at Lloyd’s has been formed that will offer large technology companies with errors & omissions insurance.

Led by Barbican Syndicate 1955, the consortium underwrites technology E&O insurance and reinsurance business on a worldwide basis, providing cover for a wide range of companies including software developers, hardware manufacturers, internet and application services providers as well as telecom systems and data integration businesses.

The other consortium members are Novae Syndicate 2007, Kiln Syndicate 510 and ANV Syndicate 1861. The lead underwriters on the facility are Stuart Quinlan, deputy active underwriter of Syndicate 1955, and Geoff White, underwriting manager and head of Barbican’s specialist eRisks division.

Typically, E&O policies are designed to cover liability associated with economic losses arising from a third party’s use of the insured’s goods, products or services. It can also cover damages to a third party arising from loss, damage or corruption of data.

White said that tech companies today face an array of potential E&O risks, but breach of contract is the one most commonly encountered.

“I have been in the sector for 13 years and I estimate that around 60 percent of E&O claims we see are to do with breach of contract,” he said. “Another claim we commonly see is breach of intellectual property rights, usually where source code has been used in another product, either intentionally or unintentionally.”

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