05 May Cyber Liability Insurance – What Is It and Why Does Your Company Need It?
Does your business solicit, obtain and/or store personal information? If you are involved in the world of e-commerce or have a system to maintain electronic customers’ records, a data breach of this valuable information can potentially be devastatingly costly to your business.
Cyber liability can affect any business, big or small. Types of cyber breaches can include sophisticated electronic security breaches involving personal/commercial data for clients, employees, volunteers, suppliers and other stakeholders. Cyber breaches can also occur when the physical devices that store the information, such as mobile phones, laptops, and data drives, are stolen, misappropriated or improperly discarded.
If your business is involved in a cyber breach, the result can be costly lawsuits, huge settlement payouts and specifically damaging negative publicity.
Certain insurers offer cyber liability coverage. Cyber liability insurance protects your business in case of a cyber-attack. The cost of cyber liability insurance coverage can greatly vary depending on the size of your company and the scope of the coverage you need. Cyber liability insurance coverage is a new and ever-expanding source of coverage so discuss with your insurance broker to see if there is a product that is the right fit for your company.
Many policies offer coverages such as business interruption, cost of notifying all affected customers of the breach, the costs associated with the breach of customer’s personal information, the cost of hiring a public relations firm to help in the public relations nightmare of the aftermath of a cyber breach and regulatory fines or penalties you may incur as a result of the breach.
In particular, for smaller businesses, insurance companies may work with you to ensure you have the tools in place to properly prepare and protect against a cyber breach. Proactive steps such as firewalls and proper employee data input protection programs can help guard against cyber breaches. Items such as laptops and mobile devices can be included in your cyber insurance policy.
As businesses continue to navigate the online world it remains critical for insurance options to continue to reflect these changes in the business landscape. The benefit of cyber insurance can provide you with the peace of mind that the business and brand you have created remain protected.
Do you have questions about this article or about cyber liability insurance in general?
Contact Rizk Insurance today and we’ll help answer any inquiries you may have.