Healthcare insurance provider Anthem is just the latest in a long list of companies to recently suffer from online data attacks, putting thousands of their customers at risk of identity theft. Unless a business carries insurance coverage for cyber-threats, this PR nightmare could also strike at the company’s finances.
Cyber Liability Insurance for Business Owners
Due to the increased vulnerability of personal data stored online, cyber liability insurance is on the rise. Just as you purchase insurance to protect from unexpected physical threats, so, too, should business owners purchase coverage to protect from “invisible” online threats.
Cyber liability insurance is new to the game, and has yet to be consistent across agencies (it is also called “cyber risk,” “privacy,” and “information security” insurance). Despite its inconsistency, this coverage is becoming increasingly important. As an independent insurance agency owner, it’s in your best interest to provide such coverage for your customers who own businesses.
Cyber Liability Coverage
If you do not provide cyber liability insurance, you can get started by looking into the most common points of coverage. The points are as follows:
- Regulatory Coverage – Focuses on costs associated with lawsuits or fines against a business. This includes the cost of a defense lawyer and court fees.
- E & O Coverage – Pertains to data breeches due to a failure to prevent them, including storing unencrypted data or not using a firewall. Such coverage can also be a part of general, non-cyber specific E & O coverage.
- Notification Coverage – One of the largest pieces of cyber liability coverage. Most states now require businesses to notify customers of cyber breeches, and this point of coverage identifies the number of customers to be notified and the method (or methods) of notification.
- Data Restoration Coverage – Covers the cost of recovering damaged or lost data. Points of coverage may include replacing hardware or software, restoration, and replacement of other electronic assets.
- Crisis Coverage – Addresses the PR aspects of data loss. It covers everything from managing media relations to providing affected customers with credit monitoring.
- Liability and Slander Converge – An oft missed, but important piece of a business’s cyber liability coverage. This piece addresses online incidents of slander, liable, copyright infringement, or other reputational damage done by those representing a specific business. This typically applies to social media posts by company employees, but also includes information on a business’ website or other online portals.
SIS Helps Protect Businesses
These points are just the beginning of cyber liability coverage. As the industry focuses more on cyber coverage, guidelines and standards will begin to evolve. We at SIS are aware of and are responding to the growing need for cyber security and liability coverage, including attending industry conferences and hosting our own sessions on the topic. Find out more about how SIS is staying ahead of the curve on our website or by contacting us today at [email protected] .