What is Cyber Liability Insurance?
You’re not silly to ask “what is cyber liability insurance?” It’s actually a very important question. Cybersecurity has become incredibly important for organizations and enterprises worldwide, especially as technology advances in nearly all industries. Therefore, having an insurance policy to protect those who utilize cybersecurity and all it offers makes perfect sense. Let’s take a deeper look at cybersecurity insurance, who needs it, and what you can expect from cybersecurity insurance providers to keep your company as safe as possible.
The Role of Cybersecurity Insurance Providers
Cybersecurity insurance providers do exactly what their name suggests; they offer insurance policies that provide a combination of coverage options for businesses when data breaches and other cyber threats are imminent. Every organization in the digital landscape is prone to cyber threats, and experts state that it’s not a matter of “if” but “when.” While cybersecurity plans are, of course, the best way to prevent these malicious threats, they aren’t impermeable. For this reason, cyber liability insurance coverage seeks to offer tools and resources that help manage and mitigate attacks before and after.
Another extremely important facet of cybersecurity insurance is the ability for businesses to recover once an attack has occurred. A data breach or other malicious attack can cause detrimental consequences, so having the wherewithal and resources to bounce back is critical in these situations. A cyber attack can impact businesses in ways that include:
- Reputation – A data breach can be detrimental to the reputation of a company, especially smaller businesses that don’t have the necessary funds to recover. Cybersecurity insurance providers can significantly help in this recovery of reputation.
- Productivity – Cyber attacks lead to downtime, which creates decreased revenue. Data breach response plans are a fantastic way to get back on track without suffering extended periods of lost revenue.
- Compromised Customer Data – When customers’ financial information is exposed in a breach, it can mean hefty fines from credit or debit card companies. Cybersecurity insurance can help prevent these fines, as well as minimize the amounts if they do occur.
Who Needs Cyber Liability Insurance Coverage?
A startling reality we face today is that the global average total data breach cost is $4.35 million. In 2022 alone, it took an average of nine months even to identify and contain a breach. Since days saved are dollars saved in terms of breaches, having a plan and insurance policy put in place can do far more than simply protect the integrity of any business.
These numbers should clearly indicate that every business needs cyber liability insurance coverage. It’s important to note that small businesses are particularly prone to breaches and cyber threats. In fact, a recent report found that 43% of cyber attacks are targeted at small businesses, and only 14% of those companies have a plan in place to protect themselves from these threats. Another report found that over two-thirds of businesses with fewer than 1,000 employees have experienced a cyber attack, and many of these never reopened after they were targeted.
What is Covered by Cybersecurity Insurance?
Cybersecurity insurance companies offer a variety of coverages and costs associated with attacks on a business, and many of their policies can be tailored to the company’s specific needs. Some specifics that are covered by cybersecurity insurance can include:
- Costs related to the recovery of compromised data
- Costs to repair damaged or compromised systems
- Forensic investigations and regulatory defense expenses
- Crisis management expenses
- Revenue lost in a business interruption or downtime
- Customer notifications in the event of breaches
- Litigation expenses
- Ability to monitor information of those impacted by attacks
Get the Most From Your Cybersecurity Provider
The safety and integrity of your business begin with prevention. At Computer Resources of America, we specialize in providing your business with comprehensive IT support when and where you need it. Our cybersecurity services provide solutions that not only anticipate threats but also mitigate them even before they could cause irreparable damage to IT systems and business reputations. We even help develop and apply the necessary activities to detect cybersecurity occurrences and provide essential means to respond to them so that companies can quickly recover.
Contact us today for more information regarding our IT consulting and other detailed services.