Cyber liability insurance has become an essential component to any risk management program. Many business owners assume their general liability insurance will cover losses pertaining to cyber, but this is not the case. To protect your business from cyber attacks, you will need separate cyber insurance. Cyber liability insurance policies are tailored to meet your company’s specific needs and can offer a number of important benefits.
Let's start with the basics.
What is Cyber Liability Insurance?
Cyber liability insurance will protect your business from the financial loss of a cyber attack. It provides coverage for legal services and defense costs, notification expenses, forensic analysis, regulatory compliance and fines, lost income, and recovery of lost files.
Do I really need it?
Most likely, yes. Let’s face it, we live in a technology-driven world. If you use any form of technology to support your business operations, you should consider cyber liability coverage.
Here are some questions to consider:
1. Do you collect, store, or send any personal or confidential data?
2. Do you accept electronic payments, either directly or through a third party vendor or service?
3. Are you in an industry that has regulations regarding your customer data?
4. Do your employees have access to any customer data?
5. Do your employees access company software or systems using a laptop, smartphone, or other electronic device?
6. Do you have a WiFi network or allow access to your systems remotely?
7. Do you use any cloud-based storage?
If you answered yes to any of the above, you're likely at risk for a hacker or data breach, and cyber liability coverage is the only insurance that will make sure you're covered from any damage that could result from it.
How much does cyber liability insurance cost?
It depends. The cost of your cyber security insurance protection will depend on a variety of factors, including your business type, industry, years in business, gross revenues, number of employees, number of customers, type of data you store, your data protection and risk management techniques, coverage limits, existing or prior insurance coverages, and more. Here’s something to consider - how much will it cost if you’re the victim of an attack and you don’t have cyber liability insurance?
Is there anything my cyber liability insurance will not cover?
When purchasing cyber insurance, it is important to understand your cyber insurance policy will not pay out if you don’t do your part to protect your company from cyber attacks as well. Just because you have cyber insurance, doesn’t mean you can neglect all other security strategies in your company. Ensuring your business is adequately protected is completely up to you.
When you get cyber insurance, the carrier does not check your security strategies — it only does so when a claim has been made. This means you might think you’re covered when you actually aren’t. To ensure you are covered by your cyber insurance, you will want to take the following steps to prove you are making your best effort to prevent any attacks:
Generally, you will need to be already doing these things in the first place to even qualify for cyber insurance.
Questions? Don't hesitate to reach out to us. We're happy to explain cyber liability insurance as it relates to your your specific business.
