One of the biggest stories of the 2013 holiday shopping season had nothing to do with the hottest toys or the increased reliance on online shopping: Hackers infiltrated Target’s point-of-sale system in December and gained access to the credit and debit card information of 40 million customers and the personal information of 70 million more.
Fortunately, the Minnesota-based chain had over $100 million of cyber liability insurance, according to sources.
As technology becomes increasingly important for successful business operations, the value of a strong cyber liability insurance policy will only continue to grow. The continued rise in the amount of information stored and transferred electronically has resulted in a remarkable increase in the potential exposures facing businesses. In an age where a stolen laptop or hacked account can instantly compromise the personal data of thousands of customers, or an ill-advised post on a social media site can be read by hundreds in a matter of minutes, protecting yourself from cyber liability is just as important as some of the more traditional exposures businesses account for in their commercial general liability (CGL) policies.
CGL, commercial property and commercial theft policies can cover damage to your tangible property but none of these will provide coverage for loss of data, which is considered intangible. The value of intangible property often far outweighs tangible property, making cyber liability coverage a no-brainer if you maintain a strong online presence or handle a customer’s private information.
A typical cyber liability policy can help protect you from costs associated with a data breach, copyright or trademark infringement, data loss due to natural disasters or hacking and business interruption. In addition, a cyber liability policy can provide you with some additional important benefits, and here are a few of the reasons why you need cyber liability insurance:
Business Interruption Loss Reimbursement: A cyber attack can lead to an IT failure that disrupts business operations, costing your organization both time and money. Cyber liability policies may cover your loss of income during these interruptions. What’s more, increased costs to your business operations in the aftermath of a cyber attack may also be covered.
Cyber Extortion Defense: Ransomware and similar malicious software are designed to steal and withhold key data from organizations until a steep fee is paid. As these types of attacks increase in frequency and severity. It’s critical that organizations seek cyber liability insurance, which can help recoup losses related to cyber extortion.
Forensic Support: following a cyber attack, your organization will have to investigate to determine the extent of the breach and what led to it. The right policy can reimburse the insured for costs related to forensics and seeking out expert advice. Additionally, some policies can provide 24/7 support from cyber specialists, which is especially useful following a hack or data breach.
Legal Support: In the wake of a cyber incident, businesses often seek legal assistance. The assistance can be costly. Cyber liability insurance can help businesses afford proper legal work following a cyber attack.
Coverage Beyond a General Liability Policy: General liability policies don’t always protect organizations from losses related to data breaches. What’s more, data is generally worth far more than physical assets, and it’s important to have the right protection in pace when you need it most. Supplementing your insurance with cyber coverage can provide you with peace of mind that, in even of an attack, your organization’s financial and reputational well-being is protected.
New technological exposures continue to emerge. As your business grows, make sure your cyber liability coverage grows with it. Don’t wait until after you need cyber liability insurance to think about protecting your company. Roper Insurance & Financial Services is here to help you analyze your needs and make the right coverage decisions to protect your operations from unnecessary risk. For your free cyber liability review, contact one of our business insurance specialists today by email here or by phone at 303-721-1145.