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Maybe I'm paranoid or something but it is hard not to be one when all you see in the news how some people sue others based on ridicules charges and then settle for millions.

My situation: I work full time but I also do mobile apps during my free time. When and if it grows into something serious I will look into opening a company and getting a proper commercial insurance. In the meantime, what insurance options available to me (as self-employed developer) to protect my assets from potentially unhappy customers who wants to sue me?

I can see online many insurance products (Umbrella Insurance, Comprehensive General Liability Insurance, Cyber Liability Insurance, Errors & Omissions Insurance, etc.) Do you know which makes most sense in my case?

P.S. I also researched LLC as an option for liability protection. However, form my research it doesn't offer much in case of Single Member LLC. Just google "Piercing the corporate veil" or "Alter Ego Liability"

  • It's a stretch to imagine how anyone could suffer million-dollar-lawsuit-worthy harm from being "unhappy" with a mobile app. Of course, that doesn't mean no one will ever try. But the situation is outrageous enough that I doubt there is much you can practically do to protect yourself against it. – BrenBarn Mar 3 '14 at 19:11
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What liability do you expect from unhappy customers? Is your app going to spill hot coffee on someone? Break someone's leg? Drive over someone's puppy? Get an umbrella insurance to cover you assets, that's always good. Other than that...

  • I was thinking a long the lines of: phone stopped working after app installation, valuable data got lost, privacy data got exposed or hacked by 3rd party via your app. Or something like that. – user13104 Mar 5 '14 at 16:55
  • @user13104 Get a lawyer to draft the license agreement for you to cover these things, that's exactly why EULAs are all miles long. – littleadv Mar 5 '14 at 23:21

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