What does Cyber Liability Insurance do for my business?
July 28, 2015
With almost 70% of businesses reported being hacked last year in a recent Property Casualty 360 article, and 36% having no cyber coverage, one might ask why? Perhaps businesses do not believe they need it or perhaps they do not know what a policy would do for them.
Below we highligh some key benefits to discuss with your insurance broker regarding Cyber Liability and Exposure protection based on your company’s risks.
Key Benefits of a good Cyber Liability Insurance Program:
- A good Cyber Liability program will provide First and Third Party coverage. First Party exposure: your own losses sustained directly by you (your company). Third Party exposure: your (your company’s) liability to others.
- The Insuring Agreement will address a wide range of cyber liability exposures specific to your business industry.
- The definition of a claim will include a demand for monetary and non-monetary damages.
- Comprehensive interruption expenses coverage.
- Coverage for Damages to third parties caused by a breach of network security.
- Customer Notification Expenses including legal expenses, credit monitoring expenses, postage and advertising costs.
First Party Protections should include:
- Loss of Digital Assets Coverage (data storage-lost or corrupted);
- Fraud and Theft (laptops, flash drives, Smart phone);
- Business Interruption and Extra Expense (system failure or overload; loss of service);
- Cyber Extortion (former employees, hackers-criminals around the world);
- Cyber Terrorism (which most often involves a specific national security target but can easily escalate into a full-scale infrastructure attack on a whole society, depriving inhabitants of electrical power, dam protection from floods, use of emergency services, etc.);
- Crisis Management Expenses
Crisis Management Expenses include:
- Forensic expenses to avoid future loss (“Bulletproofing the System”);
- Cost to restore corrupted or destroyed information assets;
- Call Centers;
- Expense to comply with laws requiring public disclosure of security breach (sub-limits): notification expenses;
- PR: “Spin Control” extra expense;
- Credit Monitoring services;
- Legal services;
- Regulatory Fines, Fees, and Penalties;
- Business Income and Extra Expense.
Third Party Protections should include:
- Network Security and Privacy Liability exposures: Privacy and Customer Data (data theft, security breach, and notification requirements);
- Electronic Media Liability: Intellectual property (Copyrights, trademarks, trade secrets, patents);
- Professional Errors and Omissions (E&O);
- Defamation (Global Jurisdiction, E-mails, forums, chat rooms, mail lists);
- Transmission of Malicious code (Viruses, worms, and malware);
- Employee Privacy Liability.
For more information regarding your business needs and Cyber Liability protection, please contact The Armstrong Company Insurance Consultants at 866-990-9286. We are here to work for you!