As a business owner, you’re handling not only the very heart of your business, its operations, all its staff, etc., but you’re also likely the one who’s handling your enterprise’s risk management strategies. It’s easy to overlook the threats that we can’t tangibly see, and it’s likely that our minds are more focused on the “worse” issues, like fire, shoplifting, and vandalism, but the fact is that cyber attacks can be not only harder to recover from but more costly than physical exposures. Moreover, smaller enterprises may not have the financial muscle that is necessary to deal with all the repercussions that may arise out of a cyber crime event. As we become steadily more digital in nature, we need to tailor our risk management strategies to include the growing threat of cybercrime.
Enter business insurance. Your business insurance package may already include commercial property, commercial general liability, and so on, but there are a few coverages that can help protect your business against the threat of cybercrime. Read on to find out what they are and how they can help.
Do Businesses Need Cyber Liability Insurance?
Cyber liability insurance, as the name implies, is specifically designed to protect your business from cyber crime and covers the costs of legal fees, loss of revenue, and even technical investigations if your business is the victim of a cyberattack. Just think – if your business’ sensitive data was breached and released publicly, you might be at risk of being sued by partners, clients, or even employees whose information was leaked. Cyber liability insurance may also cover the cost of notifying those impacted by the breach, blackmail costs (for ransomware), recovering your company’s reputation, legal fees, credit monitoring services, and so on.
So, if you’re wondering, “does my business need cyber liability insurance?” then the answer is quite likely yes, as most – if not all – businesses nowadays rely on technology to some degree.
Do Businesses Need Errors and Omissions Insurance?
Errors and omissions insurance is generally used to protect occupations and enterprises from claims alleging the failure to provide a promised service, negligence, misinformation, or other mistake to do with a professional service or advice. For businesses that specialize in IT or software developers, errors and omissions insurance can be used to protect you if you are held liable for any mistakes you’ve made which resulted in a cyberattack. Of course, this isn’t applicable for every business, but it’s worth thinking about if your business specializes in digital infrastructure.
Do Businesses Need Business Interruption Insurance?
Business interruption insurance is a vital insurance policy for any business, as it can help to cover the ongoing costs that you would otherwise have the resources to pay in the event something causes you to temporarily shut your doors. In this instance, that event could be something like a cyberattack, where your entire company’s network was shut down while you were in the process of restoring operations and data following a breach. Business interruption insurance helps cover lost income, employee wages, rent, utility bills, and so on until you can get your business running as normal again.
Poor cybersecurity in today’s day and age can only spell disaster. Read on to find out how business insurance can protect your enterprise from cyber threats.
General Liability Insurance and Cyber Attacks
Too often, business owners assume that their general liability insurance or “CGL” will be sufficient to cover them from something as devastating as a cyberattack. Unfortunately, most commercial general liability policies will exclude cyber liability, so you shouldn’t expect that a cyber attack will be covered unless you have purchased the right insurance.
Risk Management for Cyber Attacks
While insurance is a necessity and can come in clutch if something ever does happen, you can significantly reduce your enterprise’s chance of ever encountering a potential issue. Here are some tips to help freshen up your business’ cybersecurity measures:
- Implement rigorous cybersecurity training for your staff. Most phishing scams come about because of human error, such as clicking on malicious emails.
- Invest in quality cybersecurity software, like malware scanners and firewalls.
- Use multi-factor authentication, i.e., only permit accounts to be opened with at least two forms of identification. A pin or password combined with a biometric, like a fingerprint, is a good alternative to just a single four-digit code.
- Never store any payment info, banking info, or credit card numbers, as hackers can easily target these and breach your enterprise’s sensitive financial information.
- If employees are working from home, ensure that they are operating through a secure network and solidify the importance of proper cyber hygiene – especially in the absence of the strong and secure network your company might provide.
Business insurance premiums are nowhere near the money it would take to recover following a data breach, and it’s imperative that your business purchase some amount of coverage to protect your operations from the worst possible scenario. If you’re wondering what coverage your business requires, discuss with Excalibur Insurance Group’s experts today.