IFFCO-Tokio launches technology liability policy for IT / ITeS sector

Mumbai: The Indian-Japanese insurance company IFFCO-Tokio General Insurance Co. Ltd, today announced the launch of a unique policy for the IT / ITeS sector.

The technology liability 'errors and omissions (technology) policy' is designed to protect consultants and vendors against potential litigation due to software failure, deficiency in consultancy services leading to failed implementations, and failure of managed or hosted services (BPOs) resulting in delays, systemic errors and technology failures.

The new policy is being launched through a tie-up with UK-based specialist insurer Hiscox Plc, one of the leading technology underwriters in the world, and Tokio Marine Global, a subsidiary of the Tokio Marine & Nichido Fire Insurance Co. Ltd, one of the Indian partners of the Indian joint venture company.

IFFCO-Tokio General Insurance Company is a joint venture promoted by the Indian Farmers Fertiliser Co-operative (IFFCO) and The Tokio Marine and Nichido Fire, the largest insurance company in Japan. IFFCO holds a 74-per cent stake, while Tokio Marine has contributed 26 per cent through group company Tokio Marine Asia Pte Ltd.

"While most Indian IT / ITeS firms are recognised for high quality processes and services and security orientation, purchasers of IT products and services are usually keen to blame their suppliers, whether or not the supplier is at fault, in case something goes wrong, says Ajit Narain, managing director and chief executive officer, IFFCO TOKIO.

Narain further explains, "Combined with an incipient and multi-jurisdictional landscape, there is an urgent need to protect the companies in this sector against any kind of risk due to such unforeseen circumstances. This has led us to bring this policy to India. What makes this policy unique is that it is the only policy available in the Indian market that covers explicit 'breach of contract', amongst other benefits."

"The exclusive tie-up with Tokio Marine Global and Hiscox will give us access to the best technical, underwriting and claims management capabilities in the world, which will in turn give us the bandwidth to manage large policies," he added.

According to Stephen Wares, manager, International Technology, Hiscox, "India has emerged as an important market in the global IT arena, and we could not have asked for a better partner to enter the country. The underwriting and claims management capability of Hiscox, along with the understanding that ITGI has of the Indian market will provide us a competitive edge while offering this cover."

ITGI will have dedicated teams across five offices at Bangalore, Chennai, Hyderabad, Mumbai and Delhi for this policy, to work as nodal marketing offices explains N K Kedia, executive director, IFFCO-Tokio. The company has a network with 92 offices across the country

ITGI is the first insurer in India to offer a policy specifically to protect the IT / ITeS providers, especially the SMEs.

The policy will provide a cover for explicit breach of contract, infringement of intellectual property, breach of confidence / infringement of a right to privacy, defamation and payment for outstanding fees and the company says that its policy is written in simple English and is easy to understand and interpret.