Most businesses handle some degree of sensitive customer information, and a data breach could be catastrophic. Cyber liability insurance is essential to protect against the expenses associated with a data breach. It may protect business assets by paying for notification expenses, legal defense, court-related costs, judgments and settlements and the associated costs involving crisis management such as credit monitoring and public relations services.
Small businesses are frequently targeted because they rarely have the resources to prepare and defend against cyber-attacks. General liability policies often exclude cyber liability and related costs.
If your company handles any sensitive customer information, you must be aware of your vulnerabilities. If your company processes payments with credits cards, has access to customer bank account numbers, social security numbers, or any medical data, you may be particularly at risk.
Two Types of Cyber Liability Insurance
One type of cyber liability insurance focuses on first-party responses. This covers legal and related services to identify an actual breach and costs associated with regulatory compliance in the event of a breach. This insurance also addresses the response to immediate customer needs such as credit monitoring and educating your customers about the breach. Crisis management and public relations expenses are typically included, as are expenses for business interruption and costs for additional labor associated with a claim.
Another type of cyber liability insurance relates to third-party defense and liability. This may cover settlements or judgments that your company is responsible for due to a data breach, and may produce liability coverage for electronic media, which could include copyright infringement, network security, and privacy liability issues.
The appropriate data breach insurance depends on your industry and the kind of work you do. Our expert team at The Dowd Agencies will prepare you with coverage that is tailored to your specific needs.