Innovative technology transforms plenty of “traditional” industries. Education is one of the most critical markets that technology is helping to shape. From websites and apps to online tutorials and games, this space is opening new opportunities every day. However, the leaps and bounds of education technology, or otherwise known as edtech, don’t come without risks. In this post, we examine those particular risks and how insurance products can work to manage unique exposures for the edtech industry.
Edtech Market Climate
Since technology inserted itself into our everyday lives, most industries, including edtech, have jumped on the tech bandwagon. After all, if consumers are going to be using a device, they might as well be using it to learn something new. Here’s a look at the edtech climate.
Edtech Climate Pre-Pandemic
Many people assume that the COVID-19 pandemic launched edtech into reality. But edtech was past its infancy when the crisis arrived on our shores. Before the outbreak, schools — preschools to college universities — were already racing to implement technology into their classrooms and curriculums.
The edtech push had a multi-faceted purpose, including:
- Keep up with societal changes
- Prepare children with the skill sets to use technology in everyday life
- Attract families to specific school districts based on tech implementation
Edtech Climate Post-Pandemic
When the coronavirus became a household name, the threat forced us to shelter at home, pause our lives, and figure out how to progress while standing still. Not only did the virus impact our everyday routines, but it affected the way we accomplish rudimentary tasks — such as educate our children.
The fast-paced push for edtech became a shove, moving edtech to center stage in the blink of an eye. The progress for which the educational system was striving so hard became a necessity. Virtual teaching and learning is the only way to continue supporting learners safely.
Although we hope for life to return to “normal” one day, the risk of a COVID-19 relapse is significant. However, life after the pandemic will be different than it was before. For one, most schools’ abilities to implement technology into their daily schedules will be miles ahead of the previous standards. If the pandemic did one positive thing for educational companies, it was to expedite their natural progression.
Who Do Edtech Companies Benefit?
Edtech isn’t only beneficial for primary and secondary education facilities, although those are the top players in the space. Here are a handful of companies and individuals that gain from edtech innovation:
Superintendents, principals, and education leaders work to deliver cutting-edge technology to students. Even the Office of Education Technology offers programs to help spur these efforts forward by building technology infrastructure for learning.
According to a recent Gallup survey, “More teachers (64%), principals (73%) and administrators (66%) than students (42%) themselves say students would like to use digital learning tools more often to learn.” School boards are responding to this particular plea by doing the groundwork for a digital shift. They’re laying the foundation by consistently requesting a Certificate of Insurance (COI) to prove coverage for the cyber vulnerabilities edtech brings.
Schools and universities are increasing their teaching budgets by carving a place for digital tools to take precedence. According to Deloitte, a “smart campus” has multiple benefits, and we’ll start to see more of this trend pepper the higher education landscape. Accommodating a student body of digital natives calls for a total digital transformation.
Parents and Families
Few parents pride themselves on using digital devices as “baby sitters.” However, with much of the workforce participating in the gig economy (or following remote working orders during the COVID-19 pandemic), edtech is a godsend to parents and families. Plus, many parents believe that learning through edtech prepares their children better for the real and very modern world.
According to Shelley Osborne, VP of Learning at Udemy, edtech learning will become part of work. She goes on to say that skills last around five years until they are outdated. As a result, learning new skills is a never-ending process throughout our working years. Employers recognize this constant need to upskill and have jumped on the edtech train, too.
What Risks Do Edtech Companies Face?
Any technology company must face the threat of cybercriminals. When it comes to making technology a staple of learning environments, educators much acknowledge the risks involved. A cyber attack, such as ransomware, could shut down an entire school district. We’re talking about data loss, account takeovers, and learning disruptions.
Not only is cybersecurity a significant concern, but also performance issues. Learners — children and adults — require a lot from programs, apps, and websites. Edtech must be incredibly forgiving of all the demands learners toss at it. Along with rugged endurance, data privacy is also a massive concern in this space.
Intellectual property (IP), such as trademarks, copyrights, and patents, is among the risks that edtech companies face. Whether it’s protecting your IP or addressing an infringement claim, IP issues can bring a grinding halt to an edtech company’s momentum.
Essential Coverage for Edtech Companies
While edtech companies are emerging rapidly, many have been itching to play ball for years. Moreover, based on other tech industries, edtech companies have a good idea of their unique exposures. Here are a few standard insurance policies for edtech companies.
Errors and omissions (E&O)
Also known as professional liability insurance, E&O steps in to protect you from lawsuits claiming that your product or service didn’t perform as expected according to the customer and industry standards.
Cyber and Media Liability
This policy works to protect edtech companies against third-party lawsuits that arise from digital activity. Cyber insurance also helps to cover fines and penalties from regulators.
Directors and officers (D&O)
Companies can indemnify their executives against covered claims and rely on a D&O policy for reimbursement. This coverage can defend the corporate entity as well as its leadership, too.
We consider a general liability (GL) policy the firm foundation on which to build a robust commercial risk management plan. Without it, companies can quickly shutter due to the fundamental risks of merely operating a business. That said, GL coverage works to protect edtech companies against third-party lawsuits of bodily injury, property damage, personal injury, or advertising injury.
Intellectual Property (IP)
IP litigation is incredibly costly, so if your edtech company holds a patent, IP coverage is a must. This policy protects the company and its IP in two ways. First, it provides legal defense costs. Second, it helps to cover the cost of enforcing your IP rights.
Understanding the details of what coverage your edtech company needs can be a confusing process. Founder Shield specializes in knowing the risks your industry faces to make sure you have adequate protection. Feel free to reach out to us, and we’ll walk you through the process of finding the right policy for you.
Want to know more about insurance for edtech companies? Talk to us! You can contact us at firstname.lastname@example.org or create an account here to get started on a quote.