Top Five Professional Liability Considerations for IT Staffing
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Information technology staffing, or IT staffing, is a rapidly growing segment of the staffing industry. If an organization uses computers, it’ll ultimately need a dedicated team of specialized individuals to ensure technology is running smoothly and efficiently. As an IT staffing company, you hire and deliver those key individuals so your clients can focus all their energy on increasing profit for their firms. With the right risk controls in place this cultivates a valuable, symbiotic business relationship.
That’s where your insurance broker can help. One of the key components of creating an effective risk transfer program for IT staffing is developing a robust professional liability program. In a nutshell, professional liability insurance protects staffing firms from third party claims alleging financial loss. These claims arise from services performed by the key IT employees placed by staffing firms. For an IT staffing firm especially, even with the best hiring practices in place, this has the potential to be a large risk exposure.
So without further ado, here are the top five professional liability coverages all IT staffing firms should consider:
- You should have coverage for the failure to prevent the introduction of malicious code. Even with the best controls in place, no one can make a system 100% safe. There’s always the potential for a security breach, many times coming in the form of a Trojan horse or other malicious code. It’s imperative for your company to have adequate risk transfer protection for this.
- Your policy should provide broad coverage for any alleged breach of warranty or representations as to the fitness, quality or performance of your staffing employees. The unfortunate reality is that some folks are really good at misrepresenting their skillset. In IT staffing especially, the skills an employee brings to a jobsite are integral to their, and ultimately your company’s, performance.
- Professional Liability coverage should include the failure of IT employees to prevent the theft of private personal data. According to multiple sources, over 707 million records were compromised in 2015. The exposure is there, and a well-designed program will cover you.
- Your program should include coverage for the inability of an authorized third party to gain authorized access. Many companies transact their core business online. Maintaining the website may be the responsibility of your IT employee. Should the website experience issues that prevent an authorized user from logging in and making a purchase, your client very well may suffer a financial loss. A good professional liability policy will cover you for this as well.
- “Your work” as defined on your policy should be expanded to include your own website activities. In IT staffing, we typically think professional liability exposure arises out of work done by IT personnel at third party locations, however, your own company website can be overlooked as a potential for claims. There’s the probability for data to be tampered with causing harm to a third party. Additionally, advertisements including representations of performance on your website can be viewed as an express performance warranty which can be covered under professional liability.
At Assurance, we have the loss tools and resources to help you determine which plan is right for your staffing company. While choosing your program can be a risky business – it’s what we’re good at. Contact an ‘A’ Team member today.
- Liability E-Book
- Unique Risks in the IT and Engineering Staffing Segment
- 10 Standard Liability Concerns for Staffing Companies
- Staffing Exposures: Privacy and Cyber Liability Insurance
- Understanding Employment Practices Liability Insurance for Staffing Companies
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