With the Heartbleed virus causing heartburn, it’s worth taking a second look at our review of how to insure against your exposure to cyber liability. But what is cyber security insurance and why do you need it?
Sandia Labs - Creative Commons
Cyber security policies cover hacked computers, virus attacks, denial-of-service attacks and web content liability. A Ponemon Institute study found that the average financial impact to respondent companies for one or more incidents of data breach was $9.4 million, and most suffered a loss of condifential business information.
If your company uses the Internet or keeps digital records with personal information, cyber security insurance is for you! Not to mention, 62 percent of respondents from the Ponemon Institute survey said premiums for cyber security insurance are fairly priced.
Although cybersecurity insurance does not cover you for damage done to your brand and physical harm caused by equipment failures, you do need cyber security insurance for these important reasons:
1. Costs you would incur to make the proper mandatory notifications to your customers if your system is breached.
2. Misuse of any confidential or restricted information.
3. Defamation if false information comes to light (including emails).
4. If a third party sues you because of a transmitted virus due to the breach.
5. Legal fees for defending yourself against other individuals and companies who sue because of harm or loss of revenue due to your system's breach.
According to Professional Insurance Agents, cyber security insurance policies typically cover: legal liability for damages to third parties, breach of privacy coverage for damages resulting from alleged violations of HIPAA, state and federal privacy protecion laws and regulations, public relations expense coverages, comprehensive business interruption expense coverages and cyber extortion reimbursement coverages.
E & K Insurance Agency, Inc. has many insurance markets available to protect against these threats. Call 732-389-6000 or email firstname.lastname@example.org to set up an appointment to discuss cyber security insurance.