Terms like “malware”, “phishing”, and “ransomware” have entered the common vernacular over the past couple of years—especially amongst executives of small and medium sized businesses. As a result, the focus on cybersecurity amongst executives has increased. Beyond technological and physical security, more and more executives are considering adding cyber liability insurance to their company’s protections from the risks posed by cybersecurity. Is it something that your company should have? As is always the case with insurance, the answer to that question depends on the risk tolerance of you and your business.
At the very least, every executive should understand what cyber liability insurance is, what it can protect your business from, and what it costs. First, let’s define what it is: cyber liability insurance is insurance that can help protect your business from major expenses, business losses, and regulatory fines and penalties should a breach occur. In most cases, general liability policies exclude coverage for these events. Therefore, a separate policy must be acquired to protect your business from these risks. Cyber Liability insurance covers liability for data breaches involving sensitive customer information, internal crisis managements, public relations, and fraud prevention expenses. This policy can also include protection from e-theft loss, cyber extortion/ransomware, social engineering fraud, and business interruption. Most states require companies to notify customers of a data breach involving personal information, a process that can result in very high expenses.
43% of cyber insurance claims are related to hacks, malware, and viruses
57 of cyber insurance claims are related to staff mistakes or stolen devices
Cyber liability insurance is a relatively new insurance product. As a result, there is a great amount of variance in the policies that are available. You must do your homework before selecting a cyber liability policy. If you would like help evaluating your options, contact your Wolf Consulting vCIO. We can help you complete an application or guide you toward a policy that is suited to your business’s needs.