Why do you need cyber liability insurance?
Cyber liability insurance can pay for expenses of a small business that suffers a data breach, malicious attack on your computer. These important items could be left for you to pay if you do not have it. Customer notifications, legal fees, credit monitoring, and fines.
When is the best time to think about Insurance for Cyber Security?
Of course, you want to plan for this before something happens. It’s too late when the criminals infiltrate a network, steal data, or hold data hostage, make sure that this new crisis is covered by your business policy.
When a claim does happen it can be as expensive as a fire or lawsuit against you. The average cost of a small business claim for cyber is $84,000 – 148,000. Also, according to UPS Capital, 60% of small businesses go out of business within six months of an attack.
Small businesses are the most common target for cyberattacks. They have the least sophisticated protection and are easy to exploit.
Don’t think it can’t happen to you. Hackers love small retailers and any company that may store financial and personal data.
If you handle any of these items you will need cyber liability insurance coverage.
- Credit card or bank account information
- Medical information
- Customer names, email addresses, phone numbers, and addresses
- Cybersecurity for other businesses
- Social Security or driver license numbers
What is First-party versus third-party cyber liability insurance
The first party helps cover expenses when your network is hacked or your data is stolen. Third-party offers protection when a client sues your company for failing to prevent a breach at the client’s business.
Here are some of the items covered by first-party loss:
- Cyber extortion payments
- Hiring an expert to investigate the breach and assist with regulatory compliance
- Notifying affected customers
- Customer credit and fraud monitoring services
- Crisis management and public relations
- Business interruption expenses, such as the cost of hiring additional staff, renting equipment, or purchasing third-party services
Third-party cyber liability insurance can cover:
- Legal defense costs
- Settlements if you and the client settle out of court
- Judgments you’re legally obligated to pay after a data breach
- Other court costs
Cyber liability insurance is an affordable option for a small business.
These factors can affect pricing:
- Your industry
- Coverage limits
- Number of employees
Remember, hackers, love any company that may store financial and personal data. Also, small businesses are easier and the most common target for cyberattacks. If you don’t currently have this insurance coverage for cyber security – let us show you how reasonable it can be.