Business operations are more entrenched in computer technologies than ever before.
From huge corporations with millions in online sales a year to small businesses that utilize software to manage payroll, it seems that most businesses could not operate without the use – and convenience – of computer technology.
But the convenience comes at a price.
Because cyber crimes are on the rise.
What can you expect from a cyber attack?
- An unauthorized criminal hacking their way into possession of confident business and/ or client information.
- A malicious attack on computer or network systems.
Cyber attacks come with a steep price tag.
However, with cyber liability insurance, you don’t have to be stuck footing the bill should your business come under attack.
Learn the advantages of carrying cyber liability coverage and what you can do to limit your risks.
What Does Cyber Liability Insurance Cover?
Your business can suffer extensive financial losses when victim to a cyber attack, but you’re unlikely to be alone in the losses.
It’s common for third-party information to be pilfered in a cyber event, such as employee or client personal data, which can often lead to costly litigation if the third-party believes you failed to take the proper precautions in protecting their information.
Cyber liability insurance can help cover the losses incurred, both by a direct attack on your business and by damages brought on by a third-party.
First-Party Coverage
How much money do you think your business would lose if your network was down for a day? A week? A month?
With customers unable to place online orders and/ or employees unable to perform their work duties, losses can add up fast.
First-person cyber liability insurance can help your business survive and recover from a cyber breach by helping cover losses for:
Systems restoration: returning a system to operable condition following a cyber breach so that it can once again accept and process data.
Business interruption coverage: replacing lost income when the damage done by a cyberattack prohibits the continuation of necessary work processes.
Electronic data restoration: the process of returning your computer systems to normal, working order.
PR and reputation management: the practice of working to reshape the public perception of safety working with your business.
Third-Party Coverage
Should your business fail to properly protect information that you’ve collected from your clients, you could be in hot water. Customers and clients are often the target of cyber criminals and having their data fall into the wrong hands can wreak havoc on their lives.
This data can include, but is not limited to, client or customer:
- personal information
- credit card numbers
- log-in credentials
Those who have their data stolen because from your business’ database can hold you responsible.
Carrying third-party cyber liability insurance can help cover the costs customer/ client data breaches, including:
Customer notification: contacting all customers to notify them of the data breach and possible theft of their information.
Credit Monitoring Services: periodically reviewing credit reports of those who were affected by the data breach.
Lawsuits: if a client feels that you are liable for the data breach and takes you to court, third-party coverage helps pay for:
- court costs
- judgments
- settlements
Preventing a Cyber Attack
With constantly changing technologies, it would be impossible to mount a defense that is guaranteed to safeguard your business.
However, there are steps you can take in order to try and reduce your risk to cyber liabilities, including:
- Assure that your security software and hardware are well maintained and up-to-date.
- Hold a contract with a security services vendor that specializes in IT.
- Publicly post a well developed, and strictly adhered to, data privacy policy.
- Back up data, regularly and securely, in an offsite location.
Do what you can to prevent cyber liability, but be prepared should an attack occur.
Cyber liability insurance can help protect your business from bearing the brunt of paying out the high costs necessary to get back to business, as usual, following a cyber attack.