The digital landscape today faces more frequent cyber threats than ever, with ransomware attacks increasing by 105% in 2021. For financial protection in the event of a data breach, companies are increasingly investing in commercial cyber liability insurance. Read on to learn more about the benefits of insuring your small business against cyber incidents.
An Overview of Cyber Liability Insurance
Commercial cyber liability insurance provides businesses with a crucial safety net against multiple outcomes of a cyber-attack. The policy can pay for liabilities your company faces after incidents such as:
- Theft of transactional data, with hackers selling stolen customer details on the dark web
- Fraud/financial loss after the theft of network user credentials like passwords
- Business interruption as a result of cyber attack
Which Businesses Need Commercial Cyber Liability Insurance?
Consider investing in proper liability protection if you’re a technology or e-Commerce company that handles sensitive data such as:
- Patients’ healthcare data
- Customers’ transactional data like financial account information and credit card numbers
- Employee data
- Data about trademarked or patented assets
If data compliance regulations like HIPAA apply to the type of data your business handles, you will also need cyber liability insurance.
Tips to Protect Your Company with Cyber Liability Insurance
To get optimal protection for your business, you should choose a cyber insurance policy with the following coverage benefits:
- Lost income: Comprehensive cyber insurance can compensate you for any profit you lose due to a business interruption caused by a data breach.
- Data recovery: It can be costly to restore any lost business data or corrupt databases after a hacking incident. As such, data recovery is a crucial component of cyber coverage and can help you quickly rebuild your information technology systems after an attack.
- Ransomware protection: Cyber liability insurance companies usually advise against paying a ransom to regain access to any seized data or part of a computer network. However, when a ransom payment is unavoidable, your policy can cover the cost.
- Legal/court fees: This coverage pays for your legal representation and court fees when data breach victims file a lawsuit against your company. Settlements and judgments are also covered.
- Forensic analysis: Commercial cyber liability insurance policies usually cover the cost of analyzing IT networks after a hacking, data breach, or ransomware attack. This analysis involves looking into system weaknesses and determining any security upgrades required to fix existing vulnerabilities.
- Damage control/crisis communications: The law requires you to notify data breach victims after a cyber-attack on your IT systems. Also, you need to launch a public relations exercise that involves your customers to minimize damage to your reputation. A cyber liability policy can pay for the breach notifications and the cost of engaging a PR firm to help quickly resolve any chaos and protect your corporate image.
Having a cyber insurance policy that provides all these benefits reduces your risk of financial loss following a data breach. Besides, it compels your company to fortify its IT defenses in the cloud and onsite to qualify for cheaper coverage. Most providers will audit your company to ensure that strict cybersecurity measures are in place. Adhering to their high standards of IT security can minimize your company’s risk of a data breach or hacking event.
Protect Your Data with Premier Risk!
Are you interested in maximizing your commercial cyber liability insurance protection? If so, contact the team at Premier Risk, LLC today. Our agents are happy to help you find a cost-effective solution for your specific cybersecurity requirements.