Cyber liability coverage for data breaches has evolved from just insurance for information technology companies to coverage that nearly every kind of business should have as part of their insurance program. Any business not making an effort to protect personal private information is seriously out of step with the emerging landscape of privacy laws.
Cyber Liability Misconceptions
- Only large retailers need the coverage – Businesses with fewer than 50 employees are the latest targets of cyber thieves. Small businesses often fail to have adequate system protection making them an easy target. Companies with less than 75 employees were the victim of 70% of the total reported cyber-attacks.
- Traditional business liability insurance will cover cyber liability – WRONG. Traditional liability insurance does not cover your business for internet exposure or data breach.
- If we have a breach, it is not that big of an issue – WRONG. A cyber breach can cost tens of thousands of dollars. The average notification cost per exposed record per person averages $250. All states now have laws that make it the responsibility of the breached company to provide indemnity recovery help for every data record holder.
- My company does not store credit card information; therefore, I don’t have any risk – WRONG. Confidential information is defined as any personal information including addresses, email, social security numbers, Federal ID numbers, family member information, bank information and more.
- We don’t use the internet for business and therefore don’t have any exposure – According to the 2011 Data Breach Investigations Report by the Verizon, 9% of data breaches that occurred were started by an employee or other internal sources.
Cyber liability risks are real and every business is exposed. It’s time to call our office for a review of your business insurance program.