Cyber insurance is vital to any company that stores information online or on a computer, especially customer data like personally identifiable information (names, date of birth, address, etc.) and payment information (credit card numbers, bank accounts, etc.). If you store sensitive data like this, you will need cyber liability insurance to protect your business. 

Cyber-attacks are increasing in both frequency and severity. According to Bloomberg, cybercrime has costs US businesses more than $6.9 billion in 2021 and only 43% of small businesses feel prepared financially to deal with cyber threats. Ultimately, liability for cyber incidents falls on the business owner when their system has been breached. 

Cyber liability insurance covers you and your business against financial loss due to cyber-attacks and cyber risks. These cyber incidents include: 

Data Breaches: A data breach is when information is stolen from a system without the authorization of the system administrator. Cyber liability insurance helps cover the cost for forensic investigators to determine the cause of data breaches and incident response. This can include costs to notify effected customers that their data has been breached. 

Ransomware Attacks: Ransomware attacks happen when a cybercriminal breaches a company’s system and holds its essential information hostage until a ransom is paid. This can include customer data, files, databases, and financial information. Cyber liability insurance can cover the costs of cyber security experts to consult on responding to such attacks and covers the cost of the ransom. 

Distributed Denial of Service Attacks (DDoS): A denial of service attack is when a computer or system is flooded with traffic designed to crash the system and make it inaccessible by its intended users. Cyber liability insurance can help cover the cost of business interruption due to a DDoS attack, including maintaining payroll for employees and covering lost income. 

Malware: Malware means “malicious software” and is an attack that causes the victims system to execute unauthorized commands. It may do this using a trojan horse or computer virus surreptitiously placed on the victim’s computer. A cyber policy helps recover data lost due to a virus and to cover expenses due to business interruption. 

Phishing: A phishing attack occurs when a cybercriminal disguises an email or text message as a legitimate message but includes links to external sources that collect personal data such as credit card numbers, social security numbers, passwords, and bank accounts. Cyber liability insurance covers the cost of recovering and restoring lost data. 

Social Engineering Attacks: Social engineering attacks is a cyber risk similar to phishing that uses some of the same tactics but includes an added layer of psychological manipulation to trick users into making cybersecurity mistakes or releasing sensitive information. Cyber liability insurance covers legal fees for suits brought against a business owner for a breach of customer’s data. 

Overall, cyber liability insurance provides coverage for 1st party liability, such as forensic fees, notification of effected customers, credit monitoring, data recovery, business interruption, and reputational damage. Cyber insurance also covers 3rd party liability such as regulatory penalties and legal fees associated with defending the business against lawsuits due to cyber-attacks. 

Get a cyber insurance quote from Mulberri today!