Do you own a business? You might have already heard several things about cyber insurance. If you don’t have one yet, you are opening a digital door to possible criminals. This is why cybersecurity-smart companies know and are aware that cyber incidents are a fact of life, which made them buy cyber insurance.
Numerous companies today purchase general liability insurance to save themselves from potential lawsuits or claims caused by accidents, negligence, or injuries. They buy professional liability insurance to protect themselves as opposed to the cost of errors, wrongdoing or carelessness in services provided to their customers.
In the same way, plenty of companies are required by states to purchase workers’ compensation insurance to make sure they can cover an injured employee’s medical expenses and loss of income.
Moreover, why don’t a lot of companies get cyber insurance to protect themselves against first-and third-party claims emerging from cyber incidents?
According to Under Attack and Unprepared: Argo Group Cyber Insurance Survey 2017, who conducted a survey of 200 organizations in the U.S. and U.K. found out that the 57 per cent of SMEs that lack cyber insurance, only 27 per cent say they are willing to buy a policy.
In our current hyper-connected digital world, in which a weak password, stolen password, or a wisely crafted phishing email can result in a huge data breach, does the absence of cyber insurance add up to good business sense? In fact, cybersecurity risks are equal to or more than other insupportable business risks including natural disasters, fires, and business interruptions.
If you are contemplating to get cyber insurance for your business, then this article will discuss five reasons why cyber insurance is coherently a solid business investment for your company.
Safe Storage of Customer’s Data Online
Either you use an in-house server or keep your data in the cloud, there’s a great chance you store digital files filled with your customers’ private information. This data is an authentic goldmine for hackers and identity thieves, who can sneak identities and financial information to open fraudulent accounts and even try to threat your business for cash payments.
Data Breaches are Expensive
Data security experts say that data breaches aren’t a situation of it—they’re a matter of when. Whatever circumstances, if you operate a small, one-person business or an enterprise-level organization. The jarring reality is that cybercriminals target businesses of all sizes. According to the Ponemon Institute’s 2017 Cost of Data Breach Study, the average united cost of a data breach in 2016 was $4 million.
Two main reasons why small businesses are the repeated target of hackers and identity thieves. Small businesses think they are too small to attract cybercriminals. Therefore, they forget to protect themselves. Cyber thieves know this very well, and they take gain advantage of weak targets. So if you’re a small business owner, you might want to ask for more information from an insurance broker regarding getting cyber insurance.
Business Insurance Coverage Won’t Cover You
A lot of people assume that since they already have business insurance, why should they even bother to pay for additional coverage? There are plenty of business owners who think that they don’t need cyber insurance because they already insure their organizations. But your general liability policy coverage most likely comes with specific exclusions for cyber attacks.
Your business liability insurance is improbable to cover you in the event of data loss that happens due to a resentful employee or computer virus. Nearly all standard business insurance policies provide coverage in the event of system outages and data loss due to a natural disaster, but they arched exceptions for malicious attacks such as hacking and employee sabotage.
Normally, a general liability policy particularly ignores losses suffered because of the internet. This is why a great cyber liability policy can pick up where your general policy is excluded.
Provides Effective Risk Management
Huge corporations usually have entire departments devoted to risk management. For the major part of small businesses, however, constricted budgets don’t allow for this type of oversight. Nevertheless, a reliable cyber insurance policy can complete this role.
Cyber insurance carries out responsibilities close to a dedicated risk management team. There are a couple of ways insurance can connect that gap. An insurer might operate with a small company to assure a firewall is in place to protect your network, and make sure you have social media policies that lessen the risk.
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