What Insurance Does an API Business Need?

An API business can face risks through uptime failures, incorrect responses, integration defects, unauthorized access, or downstream customer reliance. Those are risk scenarios, not automatic covered losses. Technology E&O products are marketed for failures in technology services; cyber policies may address breach response and security liability. Describe whether you host the API, process personal data, depend on cloud vendors, or promise uptime and accuracy. Review Tech E&O’s definition of covered services and damages, service-level and warranty exclusions, and vendor exclusions. For cyber, check third-party systems, privacy, first-party interruption, waiting periods, and incident-response services. Verify that API and related consulting work are included on the application and policy schedule.

For an API sold through a platform or reseller, clarify who contracts with the end user and who operates the service. Those roles can affect insured status, contractual liability, and territory.