KMRD

First Came the Good News

It was a happy day when an Enterprise Resource Planning software solutions provider won a hard fought multi-million dollar software/hardware conversion contract. The provider promised the client that its software solution would integrate all operating systems, resulting in a more efficient and cost-effective model. Although all but one module was installed successfully, that last module experienced significant problems.

To see what happened when the provider was sued for $50 million in damages, click on One Minute From Normal

One Minute From Normal and Counting

The insured’s client asserted damages of over $50 million for these business occurrences:

Lost data
Impaired financial models that resulted in inflated profit margin projections
Accounting system errors that resulted in delayed payments to vendors
Payroll system errors that affected the timeliness and accuracy of paychecks to employees

A lucrative contract had turned into a lawsuit that threatened the insured’s reputation and business.

To see how the insured got back to normal, click on Solution

Getting Back to Normal

Travelers claims professionals, working with the insured, negotiated a favorable settlement with the claimant that included payment under the policy by Travelers for covered damages. Market-leading Technology E&O coverage from Travelers pays those sums that the insured must pay for a covered loss that arises out of “your product” or “your work” and that is caused by an error, omission or negligent act. The policy does not limit coverage to damages arising out of specifically scheduled or designated products, nor is “your work” limited to specified operations or designated business activities.

Because ERP software systems can be complicated and involve a large number of people to design and implement, the litigation of ERP claims (and software claims generally) can be expensive. Travelers works to take the “scary” out, so you can get on with business as usual.

Contact KMRD Partners to get back to normal with technology E&O coverage.

This material does not amend, or otherwise affect, the provisions or coverages of any insurance policy or bond issued by Travelers. It is not a representation that coverage does or does not exist for any particular claim or loss under any such policy or bond. Coverage depends on the facts and circumstances involved in the claim or loss, all applicable policy or bond provisions, and any applicable law. Availability of coverage referenced in this document can depend on underwriting qualifications and state regulations.