Top 3 Reasons Your Business Needs Cyber Liability Insurance

Business Cyber Liability Insurance

Cybercrime is the world’s fastest-growing crime – and anyone can be a victim. Despite the skyrocketing liability costs to business owners, only 21% of businesses with less than 250 employees had any cyber insurance. ¹ Meanwhile, cyberattacks now cost businesses $200,000 on average and 60% of them go out of business within 6 months.²

If that’s not enough, here are the top three reasons you should protect your business with cyber liability insurance now (before it’s too late):

#1: Cybercrime is NOT covered by standard business insurance

Contrary to what you may think, your business and property insurance coverage does not include the data in your hard drive or the fallout from a hacker attacking your office. While the computer itself may be covered, the digital data, customer files, sensitive information inside the computer is not. This also means that any costs incurred from a data breach or loss (like costly lawyers or PR firms) are also not covered by your business insurance.

#2: Your business is liable for lost credit card data

Read the small print. Your merchant service agreement holds YOU liable for any compromised or lost credit card data. So, you bear the cost of any forensic investigation, credit card fraud, or card replacements. With bad luck, these costs can quickly soar out of control.

#3: Your reputation

Any entrepreneur knows that a business is built on sweat, tears–and your good name. Reputation is everything in business, and in the modern age, nothing will sully your reputation quicker than the internet. We may all rely on it to conduct business in new ways, but the internet also leaves businesses vulnerable to new types of dangers. Customers, partners, and vendors lose trust in a business that has compromised sensitive data online. If the worst happens, cyber liability insurance covers a public relations firm to assure your customers and the public while also covering any lost business as a result.

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Sources:

  1. https://www.globenewswire.com/news-release/2018/02/06/1333676/0/en/Hiscox-Cyber-Readiness-Report-reveals-seven-out-of-ten-firms-fail-cyber-security-readiness-test.html
  2. https://www.cnbc.com/2019/10/13/cyberattacks-cost-small-companies-200k-putting-many-out-of-business.html