Cyber Liability Insurance is a vital coverage for your business in this day and age. Whether you own a small business or run a large corporation, digital security should be a top priority.
According to the Net Diligence Report in June of 2011, the average cost of a data breach exceeded $2 million! That makes the average cost more than $200 per record, which includes costs associated with loss of business resulting from the breach. The risks for a cyber liability claim run high, and the exposures are quite real.
Generally, the two most common types of data breaches included:
- Personal Identification Information which can include name, address, telephone number, social security number etc.
- Personal Health Information which contains physical or mental health information of an individual.
Most frequently breached areas included financial services and healthcare systems. When settling these claims, the majority of costs were factored in when it came to legal fees (defense and settlement).
Industries Most Likely To Be Targeted
You may not think that your business is not at risk for a security data breach, due to it’s size, and therefore forego cyber liability insurance. But did you know that 72% of all breaches occur in small-to-medium sized businesses? Take a closer look at some of the industries that are frequently targeted in cyber attacks:
- Healthcare Organizations
- Law Firms
- Insurance Agencies
- Banks & Financial Institutions
- Hospitality Companies
- Convenience Stores & Gas Stations
- Schools & Universities
- Utility Companies
If your business falls under one of these categories (and even if it doesn’t), it is probably at risk. Due to several factors, small businesses are much easier for hackers to infiltrate, and corrupt your digital records and files.
What Protects Your Clients
It is a common misconception that your business is protected from cyber crimes under a standard general liability insurance policy. A typical business policy will only cover tangible items, which does no include electronic data. Cyber Liability Insurance will protect your business and can include the following coverages:
- Computer Fraud
- Funds Transferred Fraud
- Cyber Extortion
- Cyber Terrorism
- Electronic Data Restoration
- Business Interruption & Additional Expenses