The Guide to Business Cyber Liability Insurance

Cybercriminals are more active than ever. As businesses become more reliant on remote connectivity, communications between employees, clients, and business partners have become increasingly digital. This means that information is always on the go, helping businesses keep up with day-to-day operations. However, this also means more potential threats if the right measures aren’t taken. One such measure is cyber liability insurance.

At Tekie Geek, our team of experts can help businesses in New York and New Jersey protect themselves with data security services and other IT services. Here, we discuss cyber liability insurance and how it can protect your business in the event of a data breach.

What Is Cyber Liability Insurance?

Cyber liability insurance (CLI) is an insurance policy that helps protect businesses from data breaches and other cybersecurity threats. The policies usually combine different coverage options into one policy to help provide companies with the wide range of coverage they’ll need. It’s a popular choice for small or medium-sized businesses that may not have the time, money, or resources to try to manage life after a cyberattack on their own. This form of insurance is not typically included with your standard liability insurance and will need to be purchased separately.

Because virtually all businesses across the globe use technology to help provide their customers with great service, cyber liability insurance can help just about anyone. Whether you’re a big company sending and receiving information to hundreds of different countries every day or you’re a small shop just trying to keep track of orders, a data breach can affect anyone.

What Does Cyber Liability Insurance Cover?

Cyber liability insurance, like many other insurances, covers a wide range of expenses that might come up from certain cyber threats. It provides financial protection from network intrusions and computer hacking, denial of service, network outages, data breaches, and even cyber extortion. Aspects it covers include:

There are both first-party and third-party coverages, each of which should be included in your insurance policy. First-party coverage includes things like data forensics investigations, PR costs, credit monitoring, lost revenue, and ransom paid due to ransomware, whereas third-party coverage includes things like libel claims, claims of lawsuit expenses, and losses from digital theft of money or securities.

What Isn’t Covered?

While cyber liability insurance covers a wide range of potential expenses due to a cyberattack, it has limitations. It won’t protect against intentional acts such as fraud committed by yourself or your employees. It also doesn’t protect against attacks that you were aware of before receiving coverage. It may also not cover business interruption costs from a failure in a system owned by a third party or claims that are brought in the form of criminal proceedings.

Some circumstances may cause your insurer to deny your claim. These range from incidents that are excluded from your specific policy to incidents stemming from your business’s inability to follow basic data security practices. There are also timeframes for your coverage, and incidents happening outside these timeframes could result in your insurer covering only a small portion of the costs.

Why Should You Consider Cyber Liability Insurance?

As the world becomes more digital, so do the threats we face. Between using card numbers to place orders and addresses to prepare shipments, businesses can handle large amounts of personal data each day. Cybersecurity insurance helps business owners against these threats in several ways:

Peace of Mind

You have enough to think about each day trying to run a successful business. Between preparing orders, responding to customer queries, and making sure your inventory is stocked, the last thing you want is to lose sleep over what will happen if you face a cyberattack. Knowing you’re covered can help you focus on what matters most – your business.

Saving Money

If a cyber attack happens, you stand to lose a lot, but cyber liability insurance can at least help protect your business against the financial hit that follows. Whether you need to spend money recovering lost data, paying for legal fees, or rebuilding your brand image, your policy can help.

Reputation

No matter what type of business you’re in, your customers deserve privacy, and they show trust in you by providing their personal information. In the event of a data breach or computer attack, your business is vulnerable to losing customers and suffering a damaged reputation. Having cyber liability insurance helps protect your company’s name.

Saving Time

After a data breach or other cyberattack, it can feel like there’s so much to do and not enough time. Without cyber liability insurance, you’re stuck handling all of this yourself. Spending the time and resources needed to recover lost data, navigate legal issues, and take care of everything else involved in the process means you’ll be spending less time serving your customers. Having a policy allows you to get back to work quicker.

Smaller businesses are especially susceptible to these attacks, as they are the target of many. At the same time, it’s often small or medium-sized business owners who feel that their current processes aren’t effective when it comes to mitigating these attacks. This is just another reason why CLI has become a popular option for these companies.

How Much Will Cyber Liability Insurance Cost You?

The cost of cyber insurance will vary depending on different factors, including the type of data your business manages. The more sensitive data you deal with, the higher your policy cost will be. Another factor is the number of employees that have access to this data. If more people have access, there’s a higher probability of a security breach. Your cost will also be affected by your policy limits, your deductible, and whether you’ve made insurance claims on your cyber liability insurance policy in the past.

Protect Your Business with Help from Tekie Geek

Cyber liability insurance is necessary for businesses that deal with sensitive information. Whether you’re a small or large business, you need to ensure the personal data of your customers and clients is safe, or your company’s reputation could suffer, not to mention all the headaches and costs that come with a cyberattack. Fortunately, the team at Tekie Geek has years of experience helping business owners stay protected.

We know that you and your business deserve the best, which is why we recommend some of the top-rated insurance agencies, including Chubb, AIG, Travelers, AXA XL, AmTrust Financial, and Co-Operators. Our experts are here to help businesses in New York and New Jersey get the peace of mind and protection they deserve, and we take the time to evaluate your company’s specific needs. If you’re interested in learning more about any of our IT services or would like to schedule a free consultation with us, contact us today.

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