Overview of the Robotics industry
Robotics is the inspiring intersection of engineering and computer science. This industry has all but taken flight in the 20th century, contributing to our everyday lives, commercial goals, and military missions. It’s a fast-growing and ever-evolving space that continues to reach new benchmarks each year.
Robots are often assigned to do jobs deemed too hazardous for humans, such as deep-sea exploration, bomb defusing, rescue missions, etc. But consider the use of drones and self-operating vacuums, as well. Plenty of individuals depend on robots in their homes or for leisure. Plus, many other industries lean on robotics for education and training purposes. Although robotics has carved out a distinct space in which to contribute to the world, it faces a unique set of risks, too.
Some of the biggest risks Robotics companies face
Every industry faces its challenges, but the following are some of the most significant risks robotics companies must manage:
Why is Insurance for Robotics Companies Important?
Although robotics companies experience challenges that other companies don’t, they still face the same fundamental risks of doing business. Insurance is a crucial safety net for robotics companies to have to keep operations from halting or the company from shuttering.
As mentioned, some robotics companies have faced multiple challenges in gaining momentum. For example, to move forward on a pilot project, a company needs plenty of safety nets, including insurance. Without the right policies, most local governments won’t greenlight the project.
Robotics is an industry ripe with innovation. The engineers, developers, technicians, and operators thrive on new technologies and fresh ideas. In short, it’s a space filled with rapid development. A lawsuit or legal holdup can whiplash a robotics company quickly, impacting everyone involved — sometimes shuttering the most well-intended business. To support continued evolution, robotics companies need insurance to help keep up the swift pace.
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What Insurance do Robotics companies need?
General Liability Insurance
What it covers:
This covers the organization from some of the fundamental risks that come with running an organization, such as “slip-and-fall” claims, damage to a third party’s property, products liability claims, damage to rented space, and personal or advertising injury claims.
Why you need it:
It forms the foundation of a risk management program. On top of protecting the company from legal liability caused by bodily injury or property damage, this coverage is usually required in contracts like office leases and vendor agreements.
Professional Liability Insurance
What it covers:
Also referred to as “Errors & Omissions” or “malpractice” insurance. It covers robotics companies if an act, error, or omission committed in the course of the company’s performance of professional services is alleged to have caused a financial loss for a third party.
Why you need it:
Complex litigation is expensive, and there’s a lot that can go wrong for robotics companies in particular. The policy responds to the threat of professional service disputes by paying legal fees and judgments or settlements that result from a lawsuit for an alleged failure in the provision of professional services.
Cyber Insurance
What it covers:
This coverage protects your organization from lawsuits, fines, and penalties arising from a hacking attack or data breach. It can also reimburse the company for its direct expenses, such as breach notification costs, credit monitoring, data restoration, and forensic analysis.
Why you need it:
If you collect any personal or organizational information, have a “login” feature on your site, integrate with another organization’s systems in any way, have employees who could fall for phishing scams, generate online content (i.e., blog posts), or rely heavily on email communications, you need cyber liability insurance.
Property Insurance
What it covers:
Building coverage protects properties that are owned, while business personal property coverage reimburses for covered damages to the contents of a building. Lost income and extra expenses caused by a covered loss can also be addressed by business interruption coverage.
Why you need it:
Any company with a physical presence runs the risk of their tangible property being damaged or destroyed. If you hold large amounts of inventory or own equipment, you’ll often have a lot at stake. On top of that, renting temporary office space after a fire is a surprise cost that no business needs to navigate.
How much does Insurance for Robotics Companies cost?
The cost of insurance for Robotics companies will depend on several things, including the size of the company and the stage of the company in its development process. Other factors include:
- Exposures: risks being insured
- Company practices: views on safety, compliance, and risk management
- Program structure: the amount of deductible and willingness for a company to assume more risk
- Claims history: the type and amount of past claims against the company
Types of Robotics Companies that need Insurance
No matter if your company designs, manufactures, distributes, or heads up research and development, it’s vital to protect your business. Here are a few types of robotics companies that need insurance coverage:
- Consumer
- Industrial
- Logistics
- Education
- Gaming
- Healthcare
- Machine learning
- Military
- Software
- Aerospace
- Energy
- Hardware
- Automotive
- Marine tech
- Agriculture
- Defense
- Pets
- Cleantech
- Public safety
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