What is Cyber Liability Insurance?

When you run a small business, you face many physical risks, like property damage and injuries. But your business also faces risks that come from using technology. These include everything from data breaches to hacking.

To protect against those risks, many businesses add cyber insurance to their business insurance policies. Cyber insurance can offer broad coverages to help protect businesses from various technology-related risks.  For example, if a hacker locks your computers, starts deleting files and demands a ransom, this insurance can help you respond to the attack and help your business recover lost files and income.

If your business is the victim of a cyberattack, cyber liability insurance can help cover:

• Legal services to help you meet state and federal regulations
• Notification expenses to alert affected customers that their personal information was compromised
• Extortion paid to recover locked files in a ransomware attack
• Lost income from a network outage
• Lawsuits related to customer or employee privacy and security
• Regulatory fines from state and federal agencies

Why you need Cyber Liability Insurance?

Hackers can target personally identifiable information (PII) or personal health information (PHI) you keep on your business’ computers. That’s why it’s important to protect your business with cyber liability insurance, helping you respond quickly after a data breach or cyberattack. These coverages can help if:

• Your business’ computers get a virus that exposes private, sensitive information.
• Customers or patients sue after your business loses PII or PHI.
• You’re faced with high public relations costs to help protect your business’ reputation after a data breach.

Ask yourself these questions to see if your business needs data breach or cyber liability insurance:

• Do we collect, store, send or receive PII or PHI?
• Do we work in an industry with rules about customer information, such as healthcare, education or finance?
• What would we do if we faced a cyberattack today?

How much does Cyber Liability Insurance cost?

Different factors can impact your business insurance cost. So, your cyber insurance costs will likely be different than another business’. Your data breach or cyber liability cost can depend on your:

• Number of customers, clients or patients
• Type of sensitive data and information you store
• Revenue
• Claims history