Home Insurance Forum

Aug. 30, 2007

With the growth in home computers and home-based businesses using computers, coupled with the ever-growing risks of computer-file loss and failed backups, why don't carriers find ways to insure home computer files and databases?

Robert, California

Dear Robert,

Actually, at least one insurance company has found a way to insure computer files and databases. The Hartford will cover computer data for businesses, home-based businesses, and homeowners. Here are some details about their policies, according to Cynthia Michener, a spokesperson for the company:

• Business policy: Provides comprehensive computer coverage for loss of property or data due to theft, physical damage, or computer viruses regardless of whether the computers were on- or off-premises, with options including an upgrade allowance for replacement equipment if it is more than six months old but less than six years old.

• Home business policy: Provides on- or off-premises computer and data coverage, including the costs to research, replace, and restore lost information. The standard home-business insurance policy includes $2,500 worth of protection for "valuable papers and records" (which includes computer files and data).

• Homeowners policy: Provides on- and off-premises personal computer equipment and data replacement for perils covered under a standard homeowners policy, such as fire, theft, and vandalism. (The policy does not cover data lost due to a computer "crash.") The computer-replacement coverage is for the value of the computer. The data replacement portion is subject to a $1,000 limit under coverage for valuable personal papers and records. This coverage would not apply if the computer is used for business purposes.

You can no doubt find such insurance offered by other companies by contacting an independent agent in your area.

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