Cyber Insurance vs. Tech E&O: What’s the Difference?

Cyber insurance and technology errors and omissions (E&O) can address different causes of loss, though one policy may combine both. FTC guidance describes cyber first-party breach costs and third-party liability following cyber incidents. Chubb describes its DigiTech product as combining cyber exposures with technology E&O for financial injury to third parties arising from products and services. That is one insurer’s product design, not a standard form shared by all carriers.

A software company may need to examine both a security failure and a service error, such as a missed specification that causes client loss. Review each policy’s covered acts, cyber event definitions, professional-services wording, exclusions, defense costs, and claim-made reporting terms. Ask whether one policy’s exclusions leave a gap when the same allegation involves both a service error and a breach.