Cyber Liability Insurance Information
Cyber Liability Insurance
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What is Cyber Liability Insurance?
Cyber insurance is an insurance coverage that helps protect your business in the event of a cyber attack or data breach. With a cyber policy, your insurance carrier will help you notify your clients about a breach, restore personal identities, recover compromised data, and repair damaged computer systems. In addition, certain cyber policies provide compensation in the event of a business interruption related to a cyber event.
When a corporate network, connected to the outside world, becomes compromised, the resulting damage can be tremendous. In today’s networking world, damages and security breaches to one computer can potentially lead to significant financial losses throughout an entire networking community.
There are two types of coverage in a cyber liability policy. Having both policies is crucial for the safety of your business. One policy will cover you for 3rd party liability, and the other policy covers 1st party liability. These two policies can be written separately or together.
Check out this blog post for more information on 1st and 3rd party liability as well as cyber liability insurance examples.
Who Needs Cyber Liability Insurance?
Many people believe cyber attacks to be a problem that only affects large corporations or specific types of businesses. Unfortunately, this couldn't be further from the truth. Small and medium-sized businesses are often more vulnerable than large corporations because they don't have the appropriate cyber security systems and procedures in place.
Regardless of the size of your company or industry you are in, cyber insurance coverage is an important thing to consider for your business, especially if you are storing customer data.
Companies are continuing to rely on virtual vendors and tools, connected information systems, and outsourcing (offsite hosting/storage, contract employees, etc.) to drive business strategy. These new ways of doing business increase the vulnerabilities to corporate assets.
If your business accepts credit cards, stores customer information, or conducts business online or in the cloud, then your company is at even more risk of cyber threats. In the event of a cyber attack, your company could face costly lawsuits, loss of consumer trust, and loss of income due to ransomware or business interruption.
According to Nationwide Insurance, 55% of businesses in the United States have been affected by a cyber attack, and 53% of businesses claim to have had multiple cyber attacks. With the rise in these crimes all across the country, these percentages are expected to go up, making cyber coverage a smart thing to consider for businesses everywhere.
How Much Does Cyber Liability Insurance Cost?
The cost of your cyber insurance premium will vary depending on your unique business and industry. It is typically an affordable solution that can be tailored to your specific risks, and added to boost your existing business insurance and liability policies.
If your business faces a cyber attack or data breach without having cyber insurance, the fees associated with correcting the damages will be far greater than the policies themselves. According to a report issued by the National Cyber Security Alliance in 2019, 10% of small businesses went out of business after suffering a data breach, 25% had to file for bankruptcy, and 37% experienced a financial loss.
See below for some of our recent blog posts related to cyber:
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