With the uptick in ransomware, business email compromise, and data breaches, we've been getting the question a lot lately.
What is cyber liability insurance?
Cyber insurance is most often a policy to help a business recover from a cyberattack. This could be ransomware, BEC, a data breach, or a simple virus. It can help businesses by paying out for lost revenues, paid ransoms, and legal claims that often come alongside an attack.
Who needs cyber insurance?
Any business that touches personally identifiable information (PII) such as social security numbers or even names associated with addresses for their customers or employees. Notice there I say touches. You don't necessarily need to store this data to be hit with the ramifications of a data breach. The short answer to the question is.... everyone. Every business should probably have cyber insurance. For our managed services customers, we really push for it.
While you might be saying, "Why would I pay for a managed security services company to protect me and also pay for an insurance policy?" To that I'll say this; if you call your homeowner's insurance provider after a break-in and report the burglary, what is the first question they'll ask? Was the entry point unlocked to the perpetrator? If you say yes, then you'll have a much harder time getting the full value of the 70" flat screen that was stolen. The same logic applies to a cyber attack and the subsequent claim on your insurance policy. If you leave the proverbial doors and windows open to the cyber bad guys, insurance companies will not payout!
What it covers?
It will cover all of the immediate expenses that you incur from a cyber attack. Such as:
Employee and public relations notification cost
Reparations and remediation
Missed income while business operations are interrupted
Other costs, such as paying for credit monitoring for customers
It will also cover secondary expenses such as:
Privacy breach lawsuits from customers or employees
Breach of contract or negligence claims
TLDR: Everyone should get cyber liability insurance before it gets too difficult and expensive to do so. Insurance companies are not in the business of losing money and the current threat landscape is only becoming more conducive to losing money...