You knew the statistics. You had the right security protocols in place. But your data was stolen, nonetheless. Now what? When protective programming isn’t enough to stop the worst from happening, cyber liability insurance may be your answer.
Cyberattacks are more frequent now than ever before. They’re also exponentially more devastating. Prevention tools like security software, awareness training, and proactive detection services are indispensable when it comes to warding off potential breaches, yes; But when the global cost of cybercrime is estimated at nearly $1 trillion annually, it’s probably a good idea to have a failsafe in your pocket.
Here’s what you need to know about cyber liability insurance:
What is Cyber Liability Insurance?
In short: it’s what it sounds like!
Extensive coverage for cybercrime is often not included as part of your business’s general liability insurance. Cyber liability insurance is a dedicated plan that covers the costs – whether in whole or in part – of data breaches, computer viruses, and other digital disasters for you in the case of an attack. Often, cyber liability insurance will also cover the cost of any legal claims pursuant to the attack as well.
The exact coverage of your insurance will vary depending on your provider, but broadly speaking, cyber liability insurance softens the blow by shouldering the burden of those costs associated with cybercrime.
Coverage can include:
- Forensic Investigations
- Litigation Expenses
- Fines from Regulatory Organizations
- Crisis Resource Cost
- Lost Revenue from Business Interruption
- Ransom
- Cybersecurity Improvements
Are There Different Kinds of Cyber Liability Insurance?
Primarily, there are two types of cyber coverage to consider: first-party coverage and third-party coverage.
First-party coverage accounts for out-of-pocket expenses a business may incur as a direct result of a cyberattack. Included under this umbrella are the costs of data recovery, PR, repairs, extortion, and other ancillary charges with a direct line to the breach itself.
Rather, third-party coverage helps your business defend itself from lawsuits after a breach occurs. Privacy or contract claims, charges of negligence, or even fines from regulatory organizations would fall under third-party coverage.
However, both first-party and third-party coverage could be an essential asset to alleviating the financial burden of a serious attack. You’ll find that many cyber liability insurance plans offer both options.
Do I Need Cyber Liability Insurance?
As with other cybersecurity measures, it’s easy to assume that cyber liability insurance is intended for sprawling, enterprise-level companies first and foremost. “Hackers wouldn’t target us,” you think. “We’re not big enough to get hit with a large-scale attack.”
While we follow your logic, this line of thinking is incredibly dangerous.
Any business that does any portion of work online is at risk of cyberattack, point blank period. No one, not even mom-and-pop shops, are immune. In fact, cybercrime is so prevalent that it’s no longer a question of if you’ll be attacked, but when. And when you are, the costs associated with data recovery alone will decimate small and medium-sized businesses just as easily as it will large ones.
Cyber liability insurance, therefore, is an incredibly valuable asset to us all. A vital component of your cybersecurity mix, we can almost guarantee that you need it.
Time to Cover Your Bases
Feeling the pressure yet? Great cybersecurity starts with a great partner.
EMPIST has the tools and expertise you need to feel confident that your cybersecurity program is comprehensive, proactive, and effective. Contact us online today to learn more about EMPIST cybersecurity.