It’s hard to imagine a time before the internet, smart phones and Facebook, much less one consisting exclusively of cash and check books. Businesses of all size rely on modern technology like credit card processing and computers because it’s more reliable, convenient and of course it’s a greener option.
Envision for a moment that your institution has come under attack by a hacker. The hacker has accessed your customers’ names and contact information–and worse–your employees’ personal information like their dates of birth and social security numbers. On top of that, your website is disabled so that you can’t take orders or collect the payments you need to stay in business.
Wouldn’t it be nice to have an insurance policy that protects you in case of a cyber attack right about now?
Insurance that protects you in case of a cyber attack may seem like something only larger corporations would ever need, want, or could ever afford. But believe it or not, cyber liability insurance makes just as much sense for small companies too!
1. It’s cheaper than you think
I’ve written policies with premiums as low as $1,500 per year. Cyber Liability Insurance is still a fairly new concept. There’s a LOT of variations between policies and typically some room for negotiation.
2. Your general liability policy won’t cover you
Most general liability insurance policies will specifically exclude losses incurred because of the internet. A good cyber liability insurance policy normally picks up where your general liability policy concludes.
Something else to think about: Does your organization assign mobile devices and/or laptops to employees? If so, make sure your cyber liability policy provides coverage there as well! You want to cover yourself and your company as much as possible!
3. It covers more than you think
Many policies offer “first and third party” coverage. That means that your cyber policy will pay for things like business interruption, customer notification expenses, and even the expense of hiring a Public Relation firm to repair the damage done to your reputation as a result of the data breach. A really good policy might even cover regulatory fines or penalties you receive because of the data breach.
4. Even if you don’t host the data yourself, you’re still responsible
Is your website and any of your data hosted or stored in the cloud? Take a good look at your contracts: More than likely, you’re still legally responsible. You can’t fully control how a cloud provider handles your information and data but an insurance policy can protect you if your cloud provider messes up.
Like many other mishaps and misfortunes encountered in life, we often think ‘that won’t happen to me’.
Article written by Casey Elliott of Phoenix Insurance Group. Questions regarding insurance? Leave a comment below, head over to Casey’s website contact page, or give her a call at (602) 707-7707.