With all the data breaches in the news, do you ever wonder if your information will be next? Many of the world’s largest companies have had hackers breach their defenses. If it can happen to them, then how can small business keep their information safe? The answer may be in the form of cyber liability insurance. This relatively new product goes by different aliases and offer a varying amount of coverage, but a few basics are worth thinking about.
For larger firms, an internal technical department can insure that themselves, constantly working against cyberattack. For smaller business, purchasing a stand-alone policy or other cyber insurance policy. Like all insurance policies, the coverage and pricing vary depending on what the company’s needs.
There are two different types of coverage, first-party insurance, and third-party insurance. Frist-party insurance covers the company for loss of its own data or income due to a data breach or cyberattack. This coverage usually includes the legal and technical investigations and any cost to remedy the damage, such as a breach or attack, business interruptions, payments to extortionists, or loss of data in the cyberattack or breach.
Third-party insurance cover your clients. The policies can cover responses to civil lawsuits and government inquiries; payment of government fines and penalties; notification of clients and victims; public relations and credit monitoring of clients. Companies looking to purchase a policy need to consider what the consequences will be if a breach would happen. There could be loss of client that are exposed and the reputation of the company is on the line. Some insurance policies may have minimal coverage, but there are holes that will need to be filled.
Make sure that your company has the coverage it needs to protect not only itself, but clients as well.