Small software manufacturer business. What type of business insurance is recommended?

You should have general liability plus whatever your insurance agent advises based on more complete information. You may want or need errors and omissions insurance. You will want to consult an attorney to draft a really, really good license agreement that can help protect you from liability.

You likely need general liability insurance, advertising injury insurance, perhaps products liability insurance, worker's compensation if you have any employees, and perhaps employment practices liability insurance.
A full consultation would be necessary to properly advise you.

One of your main insurance needs is to protect against claims that the software you sell infringes someone's copyright [and, perhaps, patent] in that software. The coverage for those concerns is generally called "IT insurance." If your company does not write the software but, rather, only packages and distributes it, then you need to consider requiring your supplier to "defend and indemnify" you from any such claims. You should sit down with your own intellectual property attorney and a savvy insurance broker to fashion the proper protection. Good luck.

You need a range of different types of coverage under one business insurance umbrella. I suggest you shop the internet for insurance brokers that you can consult with a get quotes from and then choose the one that best works for your business and budget.

There are several commercial insurance companies that offer IT insurance, error and omissions insurance covering copyright, trademark and unfair competition claims.

You should get IT insurance for infringement claims, professional liability insurance (covers claims that you misrepresented your product or services) and business owner insurance (covers your equipment and protects you from slip and fall claims, libel and slander, etc.). You should consider getting employer's liability insurance; it covers you from employment-related claims by your employees or applicants, but will not cover claims related to errors in payment of wages, etc. You should consult with an attorney to make sure your wage and hour practices, worker classification (exempt vs. non-exempt) and vacation and other policies are proper. You of course need worker's compensation insurance as well if you have 5 or more employees.