Insurance for IT service providers, system integrators and software developers in Germany
An update takes down the client's stock management system, a backup script has been running into the void for months, an admin forgets the installation on half the machines: IT mistakes hardly ever cost hardware, they cost the client's revenue. That is why ordinary public liability cover is not enough here. This page explains what you need and what it costs.
Do I need IT liability and cyber insurance, or is one enough?
They are two different things. IT liability pays when your mistake causes a loss for a client and the client claims against you. Cyber insurance pays your own costs when you are attacked: forensics, recovery, downtime. If you manage client systems you need both, because an attack on you hits your clients straight away.
What goes wrong in this trade
01
Faulty software
A bug in the till system, a wrong rounding rule in the invoicing software or a faulty update costs the client revenue, rework and trust.
02
Data loss
A migration script deletes client data and the backup had been broken for weeks. Recovery and extra costs quickly reach six figures.
03
Administration
Missed patches, wrongly set permissions or a security update that was never installed open the door to attackers in the client's network.
04
Third party rights
Third party code, libraries with the wrong licence or images in an app lead to formal cease and desist letters (Abmahnungen) and damages for copyright and trade mark infringement.
05
An attack on you
If you hold remote maintenance access to many clients, you are a worthwhile target. One compromised account opens every client network at once.
06
Hardware at the client's site
A server slips out of the rack during installation, or a water pipe is drilled while laying cables.
For disputes over acceptance, fees and employment contracts, which are common in software projects.
What it costs: example prices
The premium depends on turnover, activity and the sum insured. Administration and work close to data centres cost more than pure consulting or web development.
Insurance
Example
Typical range
Professional indemnity
IT freelancer, turnover 80,000 euros, 500,000 euros for financial loss with public liability
around 300 to 900 euros a year
Professional indemnity
Software company with ten staff, turnover 1.5 million euros, 2 million euros cover
around 2,500 to 6,000 euros a year
Cyber insurance
Sole trader up to 70,000 euros turnover, 100,000 euros cover
around 300 to 500 euros a year
Electronic equipment
Servers, laptops and test devices worth 30,000 euros
around 150 to 450 euros a year
D&O insurance
Management of an IT GmbH, 1 million euros cover
around 600 to 1,500 euros a year
For comparison: A freelancer's IT liability cover costs about as much a year as three to ten billed developer hours.
Guide prices excluding German insurance premium tax, as of September 2026,
from published tariff examples; the figures for the software company,
electronics and D&O are guide values from our own quoting experience.
Six things that really happen to IT service providers, all on a single Monday. Tap through the day and see who pays.
Damage so far€248,000
After your overnight update, a wholesaler's stock management system will not start. Two days without shipping.
€80,000 · Paid by: Professional indemnity
During a data migration for a CRM client, contacts were deleted and the backup was broken. Re-entry and extra costs.
€98,000 · Paid by: Professional indemnity
During installation in the client's server room a server slides off its rails and damages the unit next to it.
€12,000 · Paid by: Business liability
Your remote maintenance account has been taken over. Forensics, password changes at 40 clients and three days of emergency operation.
€35,000 · Paid by: Cyber insurance
Power surge after a lightning strike: the test server and two workstations in the office are destroyed.
€14,000 · Paid by: Electronic equipment
A client refuses acceptance and payment of a project, and you sue for the final instalment.
€9,000 · Paid by: Business legal expenses
Which package would you have had?
Paid by insurance: €0
Out of your own pocket: €248,000
Illustrative amounts before any excess.
What is paid depends on the policy terms.
Practical tips from your broker
Describe your activities precisely: development, administration, hosting, consulting and training are insured separately in many tariffs.
Choose at least 500,000 euros for financial loss, and often 1 to 3 million euros for contracts with large corporations, as the framework agreement requires.
Make sure infringements such as copyright, trade mark and data protection violations are included.
Negotiate liability caps and exclude lost profit in your contracts where possible; no insurer pays contractual penalties.
Check for worldwide cover if your software runs abroad or you work for clients in the USA.
Protect your own access to client networks with multi-factor authentication; many cyber insurers ask about this before accepting you.
Why NAMMERT for your business
We read IT clauses closely
As a broker we compare several insurers and check that your activities, infringements and cover abroad are really written into the policy.
Claims handling first hand
In boat insurance we handle claims ourselves. We know how to report a claim so that the insurer quickly provides forensics and a lawyer.
Company and private together
IT liability, cyber, company cars, income protection and pensions are looked after in one place.
Family business since 1989
Free of charge for you, as the insurer pays our commission. You have fixed contacts, not just a customer portal.
Frequently asked questions
Questions and answers
What is the difference between IT liability and public liability?
Public liability pays for injury and property damage.
IT liability also pays pure financial losses,
such as a client's lost revenue after a programming error.
For IT service providers it is the more important part.
What does IT liability insurance cost?
For freelancers, sound tariffs start at around 300 euros a year and go up to a few thousand euros
depending on turnover and sum insured.
Software companies with a team usually pay several thousand euros.
Do I need my own insurance as a freelancer working through an agency?
Yes, project agencies usually require proof of your own IT liability cover with a minimum sum.
The agency's policy generally only protects its own employees.
Are cease and desist letters over open source licences covered?
If infringements are included, the insurer handles the defence and pays justified claims.
Deliberate infringements are never insured.
Does the insurer pay availability guarantees from my SLA?
Generally not.
Promises beyond statutory liability, contractual penalties and flat-rate damages are excluded.
Is cyber insurance more expensive for IT firms?
Often yes, because IT service providers with access to many clients carry a higher risk.
Multi-factor authentication, off-site backups and documented patching lower the premium.
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