Technology and the internet are changing rapidly. We are now using computers and mobile devices to store sensitive information such as banking, social security numbers, and other data.
Because of this, cybersecurity is more critical than ever. In this article, we will discuss cyber insurance and cyber liability coverage.
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Cyber Insurance
Cyber insurance is a policy that offers coverage to protect a company’s cyber security in the event of a data breach, hacking, virus, denial of service, cyber extortion, and other cyber issues.
There are different cyber insurance coverages. These include first-party coverage, third-party or cyber liability coverage, and technology errors and omissions.
First-Party Coverage
First-party cyber insurance covers the costs of investigation of the cybersecurity incident, risk assessment of future cybersecurity incidents, lost revenue due to business interruptions, ransomware attack payments based on coverage limits, and notifying customers about the cyber incident and providing them with anti-fraud services such as credit monitoring.
Third-Party Coverage
Third-party or cyber liability coverage covers costs for an attorney and court fees associated with legal proceedings, settlements and court judgments, and regulatory fines for noncompliance.
General liability insurance excludes coverage for data breach-related liability claims, so if your business stores customer data, you’ll want to consider a separate cyber liability insurance policy.
Technology Errors and Omissions
A cyberattack can keep you from fulfilling your contractual obligations and delivering services to your customers. Errors and Omissions (E&O) cover errors in the performance of or failure to perform your services.
This can include technology services, like software and consulting, or more traditional professional services like those provided by lawyers, doctors, architects, and engineers.
This type of cyberattack can cause your service to go down and impact many customers rather than an issue with an individual.
Like any insurance, cyber insurance doesn’t cover everything. It excludes property damage, intellectual property, crimes or self-inflicted cyber incidents, and costs for proactive preventive measures.
Property Damage
Property damage from a cyberattack is not usually covered by cyber insurance. This damage could be from a data breach or cyberattack, such as hardware that was fried during the cyber incident.
Intellectual Property
Intellectual property losses and loss of income are not covered in a cybersecurity incident.
Crimes or Self-Inflicted Cyber Incidents
Essentially, no cyber insurance will cover a business charged with committing a crime related to or causing a cyber incident.
Costs for Proactive Preventative Measures
Cyber insurance does not cover training employees about cybersecurity and setting up a virtual private network.
Cyber Liability Coverage
Cyber liability insurance or third-party coverage protects you from more than just the basics of general liability insurance. Cyber liability coverage has distinct agreements for what it covers.
Network security
Network security is the aspect of cyber insurance that covers a network security failure such as a data breach, malware infection, cyber extortion demand, ransomware, or business email compromise.
The network security insurance is important for most businesses. It covers first-party costs that can happen as a direct result of a cyber incident.
This can include legal expenses, IT forensics, data restoration, breach notifications to customers, setting up a call center, and credit monitoring and identity restoration.
Privacy Liability
Privacy liability is important for most businesses. However, it is essential for those with information risks and privacy risks. Employee and customer information can be very sensitive. Breaches and violations of that information are always a threat.
Privacy liability coverage protects your company from any liabilities stemming from cyber incidents or privacy law violations.
Network Business Interruption
Businesses depend on their technology to operate correctly. Network business interruption coverage provides solutions for businesses that face operational cyber risk.
Network business interruption coverage can help you recover any losses such as lost profits, fixed expenses, and extra costs resulting from your network or network provider being down.
Some of these losses include a third-party hack, failed software patch, or human error.
Media Liability
Media liability coverage applies to protecting both your online advertising, including social media posts, as well as printed advertising. It protects against intellectual property infringement, other than patent infringement.
Finding Cyber Insurance
Now that you have a better understanding of cyber insurance, you’re probably wondering how to get cyber insurance. You can purchase cyber insurance through business providers.
Some business insurance providers offer cybersecurity or data breach add-ons to the business owner’s policies. The best way to go about finding the right insurance is to get several business insurance quotes.
Another option when seeking the right cyber insurance is to work with an insurance agent. The agent can help you compare quotes and find the best coverage at the best price. There are several cyber insurance companies to consider.
AmTrust Financial
AmTrust Financial is the best overall cyber insurance company. AmTrust can be purchased as a stand-alone policy or alongside any other AmTrust product.
The coverage includes ransom payments, data and system recovery, business interruption, reputational harm, media liability, and cyber incident response.
The Doctors Company
The Doctors Company is the best cyber insurance company for healthcare professionals. Healthcare professionals are responsible for sensitive patient information.
Therefore, medical offices like dentists, physicians, surgeons, and other medical professionals need higher security cyber insurance.
The Doctors Company coverage includes data security and privacy liability, privacy breach response services, regulatory defense and penalties, website media content liability, cyber extortion, patient notification services, and more.
The Hartford Steam Boiler Inspection and Insurance Company
Hartford Steam Boiler Inspection and Insurance Company (HSB) is the best cyber insurance for law firms. Law firms are often responsible for handling sensitive information that can cause extortion attempts.
HSB has Cyber Suite protection for small to mid-size businesses. HSB insurance covers data compromise response, privacy incident liability, identity recovery, and computer attacks including business interruption, misdirected payment fraud, telecommunications fraud, network security liability, and more.
Cyber Policy
Cyber Policy is the best cyber insurance for non-profit organizations. You can purchase a standalone cyber liability insurance policy or bundle cyber insurance with professional liability, workers’ compensation, general liability protection, commercial auto insurance, and more.
You can get an online quote. Cyber Policy covers Legal and IT forensic support, data recovery experts, PR and crisis management consultants, lost income support, credit monitoring for impacted customers, support to pay for regulatory fees, and payment card loss penalty protection
Finally, as technology advances, cybersecurity insurance will keep your client’s information secure and give them peace of mind.
It will keep your business safe from cyberattacks and other cybersecurity issues. Whether you’re a small or large business, you should always invest in cyber insurance.
