Insurance for SaaS & Software Companies

What underwriters look at

A SaaS company's biggest exposures usually trace back to two things: the data it holds and the promises it makes in its customer contracts. A breach that exposes customer records can trigger notification obligations, regulatory inquiries, and lawsuits from the very customers whose trust the platform depends on. Even a well-run engineering team can be caught out by a misconfigured storage bucket, a compromised API key, or a third-party vendor's own security lapse that ripples back to the platform.

Beyond data, most SaaS contracts include service-level commitments around uptime, performance, and support response times. An extended outage during a customer's critical period, or a bug that corrupts data or breaks an integration a client relied on, can lead to claims that the software failed to perform as promised, sometimes with damages far exceeding the contract value. Intellectual property claims are also common in this space, whether from a competitor alleging patent infringement or a former employee or contractor disputing ownership of code.

As companies raise venture funding or bring on outside board members, directors and officers exposure grows alongside it. Investors, employees, and even customers in a wind-down scenario can bring claims against leadership over decisions about fundraising disclosures, layoffs, or how a security incident was handled. A software company that pairs technology errors and omissions with cyber liability and D&O is addressing the exposures most likely to actually generate a claim, rather than relying on a generic policy built for a different kind of business.