Protect Your Technology Company Before a Cyberattack Costs You Everything

A technology company carries an exposure almost no other industry does: when you are breached, the harm usually lands on your customers rather than on you. That inverts the insurance question. Most businesses buy cyber liability to fund their own recovery; a software firm, hosting provider or IT consultancy is buying it primarily to answer the claims that arrive from everyone who was relying on them. It is also why enterprise customers increasingly will not sign without evidence of cover, so the policy is often a condition of revenue rather than a precaution.

The two failure modes look nothing alike. In June 2023, CISA and the FBI issued a joint advisory on the CL0P ransomware gang exploiting CVE-2023-34362 in MOVEit Transfer, a flaw in one vendor’s file transfer product that became a data breach for the organizations using it. Thirteen months later there was no attacker at all: a faulty CrowdStrike update took down what Microsoft estimated at 8.5 million Windows devices, less than one percent of all Windows machines, and still stopped airlines, hospitals and banks worldwide.

There is no cybersecurity regulator for technology companies the way HIPAA governs a medical practice. Your obligations come from your customer contracts: the security addendum, the data processing agreement, the uptime commitment and the indemnity you signed. That makes the coverage conversation unusually specific, because the limits you need are set by what you have already promised rather than by a statute. Where technology errors and omissions ends and cyber liability begins is the single most misunderstood boundary in this market, and getting it wrong is how a claim falls between two policies.