What Is Cyber Liability Insurance? Who Needs It?

Cyber liability insurance, also known as cybersecurity and media liability insurance, covers businesses in the event of a cyberattack. The coverage protects your business against the fallout of cyber extortion, malware, and a data breach. It extends to clients whose information you might have inadvertently exposed.

The plans offered by Thumann Agency Inc. will cover the cost of hiring a recovery specialist and getting your business up and running again. You’ll also receive a payout for business interruption as a result of a security breach. Finally, should clients sue the company for the losses, the insurer should also pay the settlement amount.

Who Needs Cyber Insurance Coverage?  

Any business that stores clients’ personal information or credit card numbers should invest in a cover.  In 2020 alone, cyber attacks exposed 155.8 million records in the United States. 

With increasingly strict privacy laws coming into play, business owners can no longer risk not having insurance. Small businesses may not feel that it’s necessary, believing that they’re not a tempting target, but this belief could cost them dearly. Criminals target small businesses 43% of the time in cyber events. While the rewards might not be as great as with a large corporation, small businesses are softer targets.

Think of it as the difference between someone who robs a bank and someone who robs a grocery store. The former requires more expertise, planning, and equipment. There’s also a greater risk of being caught.

Any computer system that has a security vulnerability is fair game. By automating attacks, it’s money for no effort.

Benefits of Cyber Liability Insurance

The benefits of cyber risk coverage include: 

●        The law requires businesses to notify anyone affected by a breach of their systems. This creates additional expenses for companies in the form of identity theft protection and the cost of lawyers to defend against lawsuits. The policy provides full coverage after data breaches and other cyber attacks.

●        Party coverages include an amount for loss of income while the company recovers from breaches and other cyber attacks. Ransomware attacks, in particular, are devastating. They make it impossible for the business to access critical systems and conduct operations.

●        It covers the cost of cyber-extortion, potentially paying or negotiating a settlement with bad actors. 47% of criminals demand ransoms between $501 and $2,000. Your insurer provides you with easy access to cash to pay the ransom.

●        Forensic support after an attack. The insurer may partner with specialists who can identify what system weaknesses the attacker exploited. The specialist will also identify other weak points and provide security awareness training for employees.

●        Professional legal assistance. Businesses may face lawsuits and penalties due to the breach. Legal support is essential in managing the fallout related to these incidents.

●        Specialized packages that cover cyber risk specifically. Your general liability insurance doesn’t necessarily extend to cyber attacks. When it does, the coverage is usually minimal.

●        It supports businesses during a challenging time. The company owners may not know what steps to take after a breach, and the insurer can provide practical advice in this regard.

Speak to the professionals at Thumann Agency Inc. and find out how your company can benefit from protection today.

Cyber Liability Insurance Coverage

The coverage differs from one provider to the next. Most cyber insurance, however, covers the costs associated with any form of a cyber attack. These policies are in place to ensure that your business survives the experience.

Coverage usually includes:

●     Data Recovery: Useful in cases where malware has destroyed or corrupted data. A recovery specialist may also work on reversing the effects of ransomware.

●     System Forensics: Understanding how the attacker gained entry to the system allows companies to prevent a recurrence. A forensics investigator will track the attack and the damage done and make recommendations on improving the system.

●     Legal Defense: U.S. privacy laws have become stricter over the last few years. Breached companies may face potential civil suits and penalties if their systems aren’t up to the required standards. A good legal defense can reduce the overall financial effects.

●     Reparations: Clients may be due some compensation for the breach of their trust. Reparations may also be necessary to restore the company’s reputation. This may mean paying for identity theft monitoring for clients or losses incurred if criminals use their data.

With the increasing risk of cyberattacks, companies can no longer rely solely on defensive measures. They must assume they can be the target of a successful attack at any time.

A specialist policy that deals with these issues provide the best form of defense. It gives businesses the resources they require to deal with debilitating attacks and to recover from them.

Protect Your Business Against Cyber-related Incidents

Bad actors use several attack strategies when targeting a company, and these methods have evolved. For example, ransomware attacks are used to merely lock you out of your systems. Today, it may also relay sensitive data to the bad actor.

Not only do you have to pay the money to unlock the system, but you also need to pay a fee to prevent the hacker from publishing it online.

Artificial intelligence has been a great aid in the fight against cybercrime. Spam filters are becoming more adept at identifying threats. However, criminals are also taking advantage of the advances in artificial intelligence. At the end of 2019, we saw a case where a deep fake incident cost a U.K firm $240,000. The attackers used AI to replicate the company’sPresident.

The unsuspecting CEO said it sounded exactly like his boss, so he didn’t think twice about performing the transfer. It was only when the fraudsters tried to push for a second transfer that he became suspicious.

The point of the story is that cyber insurance is becoming more crucial. No matter what defenses you have in place, there’s usually a way around them, and all it takes is for one person to open a spam email or click on a bad link to create chaos in the office.

Speak to the team at Thumann Agency Inc. about cyber liability insurance today by calling (972) 991-9100. We’ll help you protect your business against the worst cyber threats and ensure that you’re ready for the worst-case scenario.