Throughout the past 10 years there has been a steady evolution of technology, with these technological advances has come an entirely new area of crime and risk. In the United States alone there were 781 data breaches in 2015, this number has increased from 324 in 2014. With each data leak there are thousands of personal and business files that are exposed.

With all of these data breaches, just here in the United States it is important to evaluate your insurance coverage and determine if cyber liability coverage is right for your business. While different insurance companies use varying terminology, there are typically four areas of coverage: errors and omissions; media; network security; and privacy. These areas of coverage encompass both first-party insurance and third-party insurance.

Errors and omissions coverage generally covers third parties. This means that it will cover negligence or errors in a product or in the services you provide – this includes a breach of a customer’s data.

Media coverage also covers third parties and includes infringement on intellectual property and coverage against advertising grievances.

Network security covers both you and third parties. It ensures the policy holder against unauthorized access, transmission of a virus or code and cyber extortion.

Privacy covers both first and third parties. This insurance is important because it protects you and your business if your system is hacked, if an employee loses a device or if your business has a rogue employee.

While these four main categories are usually protected under a cyber liability policy there are some items that are usually not covered:

Loss of future revenue

-Lost value of your own intellectual property

-Costs to improve your technology system

-Reputational harm

While all businesses should consider cyber liability coverage in the digital era, there are several industries that are particularly vulnerable:

Doctors, dentists, lawyers, CPAs and others who keep client records

-IT service companies

-Charitable and nonprofit organizations with member and/or donor lists

-Private schools

-Assisted living communities and nursing homes

-Companies in the hospitality industry

-All companies with an e-commerce business-

-Anyone collecting Personal Identifiable Information (PII) and Personal Health Information (PHI)

Data breaches happen. It is possible that your business could be next. The Dowd Agencies can help protect your business against cybercrime and data breaches. Cyber liability coverage can often be confusing, so it is important to go over your policy with your insurance agent. Contact a Dowd Agent today to review your coverage options.