It comes as no surprise to any business owner that the commercial landscape is becoming more firmly rooted in the digital landscape. But what may surprise business owners is how their current risk management strategy leaves them vulnerable to significant financial loss from a malware attack. Read our guide on cyber security and data breach insurance, and learn how to protect your bottom line in the case of a digital data breach.
What is cyber liability insurance?
Cyber liability insurance protects your company from financial loss due to a cyber security or data breach. With hackers able to break into the databanks of large corporations and even the United States government, protecting your business in case your information is stolen is crucial. Even if your company is small, you can still be at risk for a cyber attack.
Is data breach insurance the same as cyber liability insurance?
No, but both types of coverage are important for cyber security. Data breach insurance is considered a “first-party” coverage, meaning it provides protection from the costs associated with a breach on your own network. Cyber liability coverage is a “third-party” security policy, meaning it protects your company from litigation if your clients’ network is hacked.
How much does cyber security coverage cost?
How much you pay for cyber security insurance will depend on many key points, including:
- Your industry (companies providing IT solutions and network security will be at higher risk and therefore pay more)
- How much coverage your company needs
- Your deductible
- The state your business is located in
- Previous history of claims
- Who in your company has access to your data
- How strong your network security is
On average, $1 million of coverage will run $1,500 annually.
How much cyber liability insurance do I need?
In order to determine how much cyber security insurance you need, you need to be able to put a value on your data. What this means is factoring in your company’s industry, your level of risk in case of a breach, and how sensitive your data is. Even if you’re in a non-technical field, you’ll still want to be sure to have a cyber insurance policy; hackers have been hitting industries that are less and less technical in recent years, and yours could be next.
Most cyber and data breach policies have coverage limits of $500,000 to $5 million, so ask your insurance advisor to help you decide how much potential damage a data breach could wreak on your business.
What does cyber security insurance cover?
Cyber security insurance covers:
- Malware or ransomware attacks
- Malfunctions in your software or hardware
- Recovering stolen data
- Legal expenses
- Business interruption
- Credit monitoring
- Expert IT investigators
- Mistakes made by your employees
- Notifying your customers
- Public relations repair
- Crisis management
Will my general liability coverage protect me from data breaches?
No. Your commercial general liability policy may cover damages to digital data, but that is not the same thing as a data breach. Digital data protection is for tangible data-holding property, such as a server that is damaged. Cyber security and data breach coverage fills the holes in your general liability policy by providing protection for your digital property, or data.
Whether your business is in Silicon Valley or the corner hardware store, you are at risk of a hacker infiltrating your network every day you are in business. Don’t leave yourself vulnerable to a devastating financial loss; add cyber liability and data breach coverage to your risk management portfolio today.
The insurance advisors at JAISIN have years of experience working with companies large and small to reduce their risk from cyber attacks and ransomware. They will help you review your current policies, recommend adjustments for better protection, and search the markets for the best coverage at the best price for you.