When Will I Need Cyber Liability Insurance?
There is virtually no business today that does not utilize computers and data networks in some way. Cyber system reliance for businesses has only grown with the continued effects of the COVID-19 pandemic and will continue to grow long after the pandemic is over. This is a very good sign, however, because an abundance of new technology will always help businesses improve their processes.
Still, as cyber reliance grows, so to do cyber-related liabilities. No data system is 100% secure, and at all times, systems are vulnerable to destruction, theft or loss. And try as you might to avoid these problems, you simply cannot prevent every instance of data loss or cyber theft. It’s at this point that you need to turn to your commercial insurance benefits for assistance, and a specific type of coverage called cyber liability insurance will be there to assist you.
Understanding Cyber Liability Insurance
Consider some of the sensitive information that you might store on computer networks:
- HR records and employee information.
- Customer information (names, addresses, birth dates, social security numbers).
- Tax information.
- Credit card or bank information of clients and the business.
If this or any other type of data were to fall into the wrong hands, a significant problem might arise. And even though you might think that you have strong network security, cyber thieves are coming up with new methods of attack every day. Your business must be ready for anything, and it’s cyber liability insurance that can provide the solution.
When Can Your Policy Help You
The reason you buy cyber liability insurance is because it can help your business take responsibility for losses caused by data breaches or losses on their networks. The coverage might help following:
- Virus & malware invasions
- Ransomware invasions
- Online extortion scams
All policies vary, and they will exclude certain losses, too. Additionally, the physical loss of data hardware in a covered event is usually covered under commercial property insurance, rather than cyber liability insurance.
What Happens When a Claim Occurs
When you file a claim against your cyber liability coverage, your plan will often help you cover numerous costs, including:
- Costs of notifying those affected by the breach
- Identity recovery and monitoring
- Regulatory fees
- Data restoration or recreation
- Credit monitoring
- System repairs and upgrades
- Public relations services
- Business interruption costs
At the end of the day, the cyber theft was likely beyond your control. Your cyber liability policy can help you restore the business to full capacity with as little threat to your bottom line as possible.
In the event of data theft or cyber hacks, immediately call your cyber liability insurance provider. They can help you determine the best way to proceed with the claim. A quick response on your part can help you minimize the damage.