Insuring Against An IT Computer Crisis
2 March, 2001
News Release For Immediate Release
Insuring Against The Possibilities Of An IT Computer Crisis
ST. PAUL, Auckland, NZ. -
A new insurance product from The St. Paul, which is aimed at the IT industry, is likely to have huge potential benefits for software and hardware providers alike.
The Techsure liability programme provides technology companies with a degree of protection should the unexpected happen. The programme will be underwritten by global insurance firm The St. Paul, which opened a New Zealand operation late last year. The St. Paul operates the programme through its national insurance broker network.
A new brochure on the Techsure liability programme broadly outlines the possible areas of exposure and examples of claims that have been handled by The St Paul on behalf of clients.
Computer software or system performance problems, with associated litigation costs, are a real risk area for the technology industry. Other potentially expensive litigation can be caused by unrealistic expectations on the user's part, customers expectations not being met by the tech firm, downtime caused by the need to retrieve lost data and crashes due to viruses or data overload.
Rapid technological change is increasing the liability exposures of technology companies. This is particularly true for technology companies that use the Internet to advertise, and distribute, their products and services. These companies face intellectual property and defamation exposures on a global scale. And all technology companies - from those developing mass-marketed software games, through to website developers and internet service providers - will be affected.
These challenging dynamics have an impact on both the legal and operational dynamics of the industry. These changes mean that technology companies must partner with committed risk exposure organisations, ones that will continue to grow their knowledge of the industry. The St. Paul has made a commitment to become an industry partner with New Zealand's technology industry, working through brokers they will be tailoring risk programmes with individual technology firms.
Dean Edwards, Technology Manager, St. Paul International Insurance Co. Ltd, said the Techsure product provides liability insurance programmes for technology companies.
Dean Edwards says: "There has been an explosion in litigation involving the performance of computer systems. In a recent US lawsuit, it was quoted in evidence that approximately 40% of all computer systems fail. Another staggering statistic is the size of the damages, in some cases rising to seven, eight or even nine figures.
"Technology companies are getting sued. By being insured, technology companies can protect themselves against economic loss, intellectual property and defamation claims. Today's spiralling legal costs and increasing damages can threaten a technology company's business and personal assets. The cost of defending allegations can be prohibitive and the need for a structured liability programme is real.
The St. Paul Techsure Liability Programme is designed to provide technology companies with one single market for insurance and risk management, anywhere in the world. The St. Paul aim is to help technology companies build a flexible, yet comprehensive approach to their insurance requirements," Dean Edwards says.
The St. Paul Techsure Liability Programme ("Techsure") can help cover the immediate financial consequences of the unfortunate situations that may arise. This cover is most relevant in the area of computer failures. Techsure can cover anything from meeting legal expenses to maintaining a firm's marketplace reputation. Techsure also provides a method of dealing with common technology risks. The St. Paul will tailor a risk management programme to suit individual needs, so IT product/service suppliers are better protected if technology does let their customers down.
Dean Edwards says the Techsure Liability Programme is one of two IT industry products being launched this month by The St Paul. The second one will deal with network security issues, providing cover against hacking and other risk factors.
For more information, photos or to set up an interview time with Dean Edwards, call:
Angela Penteado Director, Stratcomm Consulting Ltd. Tel. (09) 379 3000 Fax: (09) 379 3004 Mobile: (021) 46 00 47
The St. Paul Companies is headquartered in Saint Paul, Minnesota, and provides commercial property-liability insurance and non-life reinsurance worldwide. The St. Paul reported 1999 revenue of more than $7.5 billion, total assets of $38.9 billion, and is ranked No. 204 on the Fortune 500 list of largest U.S. companies. For more information about The St. Paul and its products and services, visit the company's web site, www.stpaul.com. About The St. Paul in New Zealand
St. Paul International Insurance Co. recently expanded its operations to New Zealand by opening an office in Auckland, which commenced underwriting, risk control and claims service effective October 1, 2000. The company is conducting business as St. Paul International Insurance Co. Ltd., a subsidiary of The St. Paul's international head office in London. The New Zealand operation will focus its products and services for local commercial clients, with emphasis on specialty liability products for professional indemnity, the technology, health care and marine industries, plus surety bonds for the construction industry.
"The New Zealand market is one where we can fill a need for more specialized liability insurance products,'' said Mark Pabst, president and chief operating officer-St. Paul International. ''We believe The St. Paul, with its commitment to risk management and to customer-focused specialized covers, can offer valuable products to this growing commercial market sector.''
St. Paul's operation in Auckland is led by Gary K. Thomas,
general manager. A team of underwriters, risk management and
claim staff will serve insurance brokers and policyholders.
Joining the Auckland office are: Dean Edwards, Professional
Indemnity and Technology Underwriting Manager, Colette
Taylor, Professional Liability Underwriter, and Frances-Mary
Cossey, Risk Manager. The office is located at: Level 13,
Phillips Fox Tower 209 Queen Street Auckland New Zealand
Phone 64 9 976 9000 Fax 64 9 976 9001