Better safe than sorryFreelancer Liability Insurance

On the menu• Certibit• What does LIABILITY mean?• Why take liability insurance?• The right freelancer liability insurance• 7 liability do’s & don’ts for freelancers• Our proposition

Certibit

• Founded in 2014• For IT guys (and girls ofcourse)

• By an IT guy• First & only Belgian insurance broker just for ICT:

• IT Companies• IT Freelancers• Tech Startups

• Our goal: deliver products that stand out by being better tailored and better priced

What does LIABILITY mean?

Being liable for something

requires 3 elements(and I apologize in advance for the gross, but very self-explaining pictures)

1 – You need a BUG

2 – You need DAMAGE

3 – You need to prove CAUSE-EFFECT

1 – A bug, error, fault, omission, …• Something• YOU did WRONG• YOU forget to DO• YOU didn’t FORESEE• …• YOU didn’t do WRONG (but are ACCUSED of)

2 – Damage• Bodily injury• Material damage• But also: Financial damage -> ICT Liability• Loss of CLIENTS• Loss of TURNOVER• Increased COSTS• …

3 – Proven Cause-effect• Bug + damage ≠ LIABILITY• For instance• Bug in functional analysis or business requirements• Agile development: it was a joint effort (who did what?)

• Bug + damage + proven cause-effect = LIABILITY

Why take liability insurance?• “It’s a MORAL duty as a professional freelancer…”True, but…

• “It protects my assets against claims…”True again, but…

• “It’s a contractual obligation and I don’t want to violate the terms of my contract”

Indeed. And you’re David and they’re Goliath…

Why take liability insurance?

To DEFEND you

To PAY for DAMAGES (instead of you)

To SEEK COMPENSATION (for your own damages)

The right freelancer liability insurance• Case: You get overexcited during the daily SCRUM meeting: You

spill your hot cup of coffee all over the place. • Colleague Tim’s laptop is wasted. • Colleague Jessica has minor burn wounds.

• Insurance insight:• Case has nothing to do with ICT liability• But it’s your coffee and your enthousiasm -> you will be held liable

• The right freelancer insurance… contains general liability coverage

The right freelancer liability insurance• Case: Prior to a new software release the old servers are replaced by

new ones. John asks you to help him make the move. One of the machines slips out of your hands and falls to the floor.

• Insurance insight:• Case has nothing to do with ICT liability• But the server was in your ‘safe’ hands

• -> you will be held liable

• The right freelancer insurance… contains coverage for goods in your custody, care and control

The right freelancer liability insurance• Case: Although well-tested your latest app release

appears to miscalculate prices in specific circumstances. It takes 2 years before the mistake is discovered by your client/the customer. The loss in turnover amounts to 350.000 EUR.

• Insurance insight:• You made a professional mistake. The software bug was your piece of code.• Maybe certain responsabilities can be retargeted towards the testers?

• The right freelancer insurance… contains coverage for your professional liability

The right freelancer liability insurance• Case: To speed up the development process you copy/paste

some open-source code you find on the internet. The piece of code does exactly what you need.

• Insurance insight:• Your open-source code wasn’t really open source• You could be held liable for (unintended) copyright infringements

• The right freelancer insurance… contains coverage for unintended copyright infringement

The right freelancer liability insurance• Case: You have an anti-virus program installed on your laptop. During

office hours you are allowed to bring your own laptop and hook it up to the network. A malicious virus is released onto the network through your laptop.

• Insurance insight:• The virus is not your work but who’s work is it?• From a legal perspective you are a possible target to reclaim damages

• The right freelancer insurance… contains coverage for computervirus claims(having taken precautions)

The right freelancer liability insurance• The right freelancer insurance…• Contains general + professional liability + legal assistance• Contains coverage for

• Copyright infringement• Slander• Computervirus claims• Internetrelated activities

• Contains a correct & precise description of your activities• Is – if necessary - tailored to your specific activity

• ESSENTIAL: Makes the difference in CLAIMS MGMT

7 Liability do(nt)’s for freelancers

• Make sure your policy exactly depicts your ICT activities• Stay within timing and/or budget• Buy sufficient insured capital

Do!

7 Liability do(nt)’s for freelancers

• Sign contracts with aggravated liability (eg. sanction clauses)• Take on a job for which you are not

suitable• Commit to more than best-effort• Step into a David vs. Goliath

relationship without insuranceDon’t!

Our proposition for freelancers• All-in-one package• Including IPR infringement, slander, …

• Specificly designed for freelancers• No extra premium for project managers,

IT managers, lead architects, …• Easy• Fixed price for turnover < 250.000 EUR• Simple, straightforward questionaire

IT Freelancers

Pricing (vs. insured capital professional liability) 250.000 EUR 500.000 EUR 1.000.000 EUR

409 EUR 491 EUR 655 EUR

Questions? Let’s talk!• Office: Noordlaan 109 – 9200 Dendermonde• Business area: Belgium

• Call: 052/22.12.32• Mail: steven@certibit.be• Browse: www.certibit.be• Come and find us on: Facebook, Twitter & LinkedIn