Nowadays, the majority of data collected by businesses is done online, and any company that collects data in any capacity should understand the importance of protecting that data. Even the most comprehensive cyber security plan can still have loopholes that hackers know how to take advantage of, so safeguarding your data leaves no room for error. This is where cyber liability insurance comes in.
What is Cyber Liability Insurance?
All businesses that use technology to collect data are at risk of data breaches, hacking, etc. Even with security measures in place to protect your business and customers, your data can still be vulnerable. Cyber liability insurance helps to keep your business afloat in the event of any financial or operational loss due to a cyber-attack. This type of insurance can also help cover investigations, lawsuits, reputation damage and all the legalities that follow a cyber-attack.
What Does it Cover?
There are two types of coverage for cyber liability insurance: First-Party coverage and Third-Party coverage. A comprehensive policy will help you with both types of coverage, but there are distinctions between the two.
It’s important to note that most comprehensive policies are flexible and you can work with an agent to customize a plan that works for your business.
First-Party Coverage
This is the money that the insurance company will pay your business directly. That money can be used for the following factors:
- Lost or damaged data
- Loss of income
- Cyber extortion
- Notification costs (coverage of cost for notifying customers in the event of a data breach)
- Crisis management
Third-Party Coverage
Third-party coverage is more so needed when injured parties of the cyber-attack make claims against your company. Some examples of claims they help cover include:
- Security and Privacy Liability – claims that allege your business didn’t do enough to protect customer or employee data. this coverage can help protect your company from bankruptcy from these claims.
- Electronic Media Liability – coverage for lawsuits that accuse your business of slander, defamation, copyright infringement, and more. This is typically the result of private data being breached then published on the internet.
- Regulatory Proceedings – coverage for fines or penalties your company suffers as the result of data breach laws. Third-party coverage can help you hire an attorney to navigate these laws.
Who Needs Cyber Liability Insurance?
Any business that stores or processes sensitive information should be protecting their business with cyber liability insurance. This information includes customer details such as names and addresses, credit card or bank information, social security or driver license numbers, etc.
Additionally, small businesses often lack structured cybersecurity processes, which makes them attractive targets for hackers. If you store any kind of client information and don’t have an effective way of securing your network, this is a good indication that you should look for cyber liability insurance.
Keep Your Data and Business Reputation Secure
The ability to collect larger amounts of data continues to grow as technology develops, and businesses are leaving themselves exposed to cyber damages. Cyber liability insurance can provide you with peace of mind, and the financial security to recover lost data, your reputation, and more.
Don’t get caught off guard. See your organization from an attacker’s perspective. Kyber Security can conduct a comprehensive cyber insurance and controls preparedness assessment to evaluate vulnerabilities.
Here’s What You Can Expect From an Assessment:
- Understand your organizations gap with core components of the NIST CSF
- Obtain immediately actionable information for how you can better secure your organization
- Learn how you can improve the overall cybersecurity posture of your organization
Blog courtesy of Kyber Security, a managed security service provider in Fairfield, Connecticut. Read more Kyber Security blogs here.
