Why Cyber Liability Insurance Is Crucial to Protecting Your Company
In the age of ever-increasing remote work, engaging in risk mitigation best practices on the job is a very important part of data protection and cyber integrity. Cyber liability insurance is now crucial for companies with employees who work remotely. Following is a primer of what is covered (and not covered) and why this coverage is a must-have addition for your business.
First-Party Coverage
First-party coverage pays for expenses incurred immediately following a cyber breach. Examples of these expenses are things like costs involved in notifying the public, clients, and employees and rolling-out a public relations response to the cyber breach to protect the company’s reputation.
This is also the type of cyber liability insurance that would cover extortion money–for example, if your company’s data is hijacked and inaccessible to you without paying a ransom. Paying for your clients’ credit monitoring service after the breach would also be covered by first-party coverage.
Staff may not be able to work immediately following a cyber security breach, and client commitments might not be possible. Claims for “missed income” the business has suffered would fall under this type of Cyber Liability Insurance.
Third-Party Coverage
Third-party coverage protects the company by paying for defense and legal claims should lawsuits against the company occur. Costs for regulatory fines, negligence or privacy claims from clients, and breach-of-contract claims from vendors after a cyber security breach occurs fall under this type of insurance.
Exclusions From Cyber Liability Insurance Coverage
The following are excluded from cyber liability insurance coverage:
- Loss of property (commercial property insurance could cover this).
- Criminal activity (commercial crime insurance could cover this).
- Bodily injury and property damage (general liability insurance covers this).
In addition, beware of “social engineering”, which is when people are tricked into transferring company funds, as this is also excluded from cyber liability insurance. For the employee’s part in protection of the company, ensure your key staff are aware that these types of money scams occur in the workplace as well as in our personal, private financial lives.
How benefEx Can Help
Cyber liability insurance can be customized to meet the specific needs of your company and as a result, costs vary considerably. It’s important to be aware of factors that can be in your control in terms of potential costs.
Modern-day problems require cutting edge solutions. Contact benefEx today to discuss how cyber liability insurance coupled with industry specific data can determine your plan structure and ultimately protect your bottom line.