You’ve heard of car, life and health insurance, but what about the other type of insurance missing from your business life that could help protect your business?
This newer type of insurance is cyber insurance, and it helps to protect your business from any damage caused by cyber criminals, and to alleviate many different consequences that come as a result of a cyber attack.
But, do you need cyber insurance? And how does cyber insurance work?
Let’s find out some details that will help you decide if getting cyber insurance is the right move for your business.
How Does Cyber Insurance Work?
First things first, how does cyber insurance work?
Just like any other type of insurance policy, cyber insurance works by offering coverage to protect a business from certain losses as a result of cybersecurity breaches in your network.
The coverage of the risks will depend on the type of policy you choose, and there are policies that suit small to medium-sized businesses and large corporations alike. Depending on the nature of your business, there may also be specific add-on protection features that you could add to give you a broader coverage.
What you need in a cyber insurance policy
Cyber insurance coverage will vary from company to company. In order to know what to look for in cyber insurance coverage, it’s important to keep your business in mind and the types of services it provides to its customers.
To give you an idea of what you can generally offer protection in the following categories:
Network security coverage
This is the most important of all features that cyber insurance should provide. Most companies require network security services as this is what will keep a business’ digital presence protected from malware, data breaches, extortion, ransomware and more.
Network security coverage can also include coverage of expenses that emerge as a direct result of a cybersecurity attack. Such expenses can be classified as:
- IT investigation/IT forensics
- Data recovery
- Public relations services
- Handling of breach notification to the business’ customers and employees
- Ransomware negotiation and payment handling
- Legal expenses
Business Network Disruption
When a business falls victim to a cyber attack, it’s only a matter of time before the network is down and all data is wiped out of all devices connected to the company’s network. Unless a cybersecurity expert deals with the issue directly, there is no telling in how long a business network can be down.
This means that a business would not be able to perform its day-to-day activities, causing profit loss and unexpected expenses while recovering from the attack. To aid with damage caused by network disruption, cyber insurance policies cover:
- Aid in cybersecurity hacks and data breaches
- Aid in system failure as a result of failed software or human error
Many businesses deal with sensitive information where a data breach or leak could bring serious consequences to a business.
Data violations could not only threaten the privacy and security of customers or employees who were affected, but it could also compromise a business’ image and reputation for a lack of cybersecurity measures.
Privacy liability coverage aids businesses by protecting them from any liability that could arise as a result of a cyber attack or any violations of a company’s privacy policies.
While this may seem like a simple side-effect of a cyber attack that can be fixed by recovering the data, there is not much a business can do if the information gets leaked or sold; which is something that oftentimes happens on the dark web.
When it comes to a violation of private information, a business can quickly become involved in a much more serious matter where they will have to face government agencies to get to the bottom of the attack.
Media liability provides coverage for infringement of intellectual property. This normally has to do with service advertisement rather than patent infringement, as it could be believed. Further than online advertising, this coverage applies to printed advertising along with social media posts, advertising and general interaction with users.
Errors and Omissions
Cyber attacks can quickly turn a business upside down and could lead a business to fall into violation of its contractual obligations as a result of leaked or stolen customer or employee data and fulfillment of their services to customers.
The errors and omissions section of a cyber insurance policy helps businesses by covering the claims that may arise as a result of errors or failure to perform a company’s duties and obligations.
This is not something that only businesses with several employees can benefit from, but also other types of business practices with professionals such as doctors, lawyers, engineers, architects and others who rely on cyber insurance to avoid or address allegations of negligence or a breach of contract due to network failure or a cyber attack in general.
Depending on the type of policy, cyber insurance could also cover legal defense costs or indemnification expenses that may result from a dispute with customers or employees.
Cyber insurance is not exactly a one size fits all type of deal, as companies have such varied forms of management of their digital presence. Some companies have small teams of less than ten people, but with a large database of clients and work information. Others may have hundreds or thousands of employees, with an even larger clientele.
Cyber insurance policies have to be shaped and tailored to the needs of a business and may have to change as a business grows and evolves. However, cyber insurance policies start from as long as $200 per year and can run up to $2,000 per year depending on the amount of services and coverage your business needs.
What does cyber insurance not cover?
Of course, all policies come with exceptions of what they do not cover and it’s important to understand the coverage limits of your cyber insurance policy. Here are some examples of what you can expect for cyber insurance not to cover:
- System improvement
A policy will offer coverage according to your current system, network, software, devices and other equipment. However, it does not cover upgrades to internal technology systems or any software. Any changes will run as an additional cost with your insurance policy if they offer these services.
If there is a loss of value to a business or a business’ digital presence and intellectual property as a result of theft or security violations, a cyber insurance policy will not cover this.
- Profit loss
While cyber insurance policies do cover certain profit losses that may arise as a result of a cyber attack, any potential future loss of profit will not be covered. Immediate losses can be covered by an insurance policy, but future losses will always run on the account of the client.
Letting us help with your cyber insurance
CyberNinjas is a business dedicated towards the protection of your business’ digital footprint and will guide you understand why cyber insurance is important and how cyber insurance can help mitigate the risk of a cyber attack.
It’s normal to have a lot of questions regarding what type of cyber insurance policy is best for your business, which is why CyberNinjas will take the time to explore all options for you so that you may choose a policy that offers the coverage your business needs.
Our team of experts will help you understand the basics of your policy and will ensure that we provide you with insurance that will protect your business according to your specific needs. Not only will we help you to implement smart cyber security practices in your workplace, but we will take the time to provide you with a dedicated, tailored and effective strategy to safeguard your business and mitigate the chances of you falling victim to cyber crime.
Whether you need us before, during and after an incident, CyberNinjas promises service of the highest quality with the attention to details that you and your business needs. There is no business to small for our team, so don’t be afraid to reach out and get in touch with us for a consultation, so that we can share with you some information about what we have to offer as a team of cybersecurity professionals and to analyse the risks your business faces against the world of cyber attacks.
Do not wait until it is too late and you have fallen victim to a cyber attack, prepare for the worse so that if it does happen to you, you know exactly what procedure to follow with the security that you have the best of the best on your side.