Cyber Liability

What is cyber insurance?

Cyber insurance covers your business’ liability for a data breach that includes sensitive customer information. This could include things like Social Security numbers, credit card numbers, account numbers, driver’s license numbers and even medical records.

Why doesn’t my general liability insurance cover cyber liability?

GLI covers bodily injuries and damage to property which is a result of your products, services or operations. Be sure to check your policy because cyber insurance is usually not included in your general liability policy.

What does cyber insurance cover?  This can differ significantly between carriers and is often offered a la carte for you to pick and choose which coverages you need and do not need. These can include:

  • Legal fees and expenses as well as:
  • Restoring personal identities of affected customers
  • Notifying customers about a data breach
  • Cost to monitor the credit of affected and potentially affected clients
  • Repairing damaged computer systems
  • Recovering compromised data
  • What to look for as a cyber insurance buyer

Like any business insurance, cyber insurance coverage varies by insurer and policy.

When shopping around and comparing policies among insurers, here are some things to look for and ask about:

  • What are the ‘sublimits’ for coverages?  Often a cyber policy will have lower limits for covered losses, which can be significant between policies and can explain a lot of pricing difference.  A common and important example is social engineering coverage.
  • What are the deductibles? Be sure to compare deductibles closely among insurers, just like you do with health, vehicle and facility policies.
  • Does the insurance company offer a stand-alone cyber policy or is the coverage simply an extension to an existing policy? In most cases, a stand-alone policy is best and more comprehensive. Also find out if the policy is customizable to an organization.
  • How does coverage and limits apply to both first and third parties? For example, does the policy cover third-party service providers? On that note, find out if your service providers have cyber insurance and how it affects your agreement.
  • Does the policy cover any attack to which an organization falls victim or only targeted attacks against that organization in particular?
  • Does the policy cover non-malicious actions taken by an employee? This is part of the E&O coverage that applies to cyber insurance as well.
  • Does the policy cover social engineering as well as network attacks? Social engineering plays a role in all kinds of attacks, including phishing, spear phishing and advanced persistent threats (APTs).
  • Because APTs take place over time, which can be months to years, does the policy include time frames within which coverage applies?

If you’re interested in cyber insurance coverage for your business, please give our office a call or visit our quotes page today.

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