Cyber Liability is complex. Learn to simplify it here.

Cyber attacks are increasingly common.

You hear about the breaches of some of the biggest companies in the news. The standard reaction goes something like, “at least it wasn’t me” or “that could never happen to me,” or, perhaps most alarming of all, “we don’t have that exposure.” Business owners, your clients, might not be aware of their own cyber liability exposures.

It’s nerve-racking enough to hear about the big companies. But there’s something your small-to-medium-sized business clients probably don’t realize; small businesses are major targets. A report from the U.S. Securities and Exchange commission cites a 2015 study stating “the majority of all targeted cyberattacks last year [2014] were directed at SMBs”.

Big businesses typically have the resources to handle a cyber breach. Smaller businesses might not.

The experts at ProWriters can help you understand and communicate with your clients about the risks they might face.

Cyber Liability Insurance for Small Business— Is It Necessary?

As James O’Neill puts it in an article for the Insurance Journal, “if your client stores or collects personally identifiable information in either a written or electronic format, they have an exposure.”

If that information is stolen or tampered with, your client is on the hook.

Dealing with a breach requires a considerable amount of time and money. This could damage your clients’ ability to get loans for their businesses. It could damage their reputations with consumers. Your client could be liable to any customers who had data stolen.

Another prevalent issue is extortion. Hackers will take over a business’s system and hold it ransom until the business pays to regain control. This could cost a small business thousands of dollars just to recover the stolen data.

But it’s not just hackers an extorters that create these cyber liability exposures. There are other forces at work:

• The loss of company phones, laptops, hard drives, or other electronics where info is stored can put you at risk
• A software malfunction–software updates have occasionally left data vulnerable
• An employee going rogue–employees mishandling information, either by accident or deliberately, can lead to compromised data

These account for more data thefts than the television drama-caliber hacks that show up on the news. Understanding the prevalence and the variety of breaches is the first step in helping your clients understand their cyber exposures.

The next step is helping them understand their coverage.

What Will Cyber E&O Insurance Cover?

Cyber coverage has come up again and again, with companies suing their insurance carriers over what was, and was not covered in their cyber privacy insurance plans.

Coverage and liability are tricky issues. In most cases, third party contracts will explicitly limit their own liability in the event of a breach. This can leave your clients responsible in the event of a hack or data theft.

Most standard insurance plans leave your clients unprotected. But even with cyber insurance, coverage can have some unexpected, and costly, gaps.

Credit card theft and the resulting fees and penalties are especially contested. Businesses have had to pay millions of dollars after data thefts because they found out too late that their cyber liability insurance plans didn’t cover the fines, fees, and penalties incurred from credit card processors or card-issuing banks that need handle fraud claims resulting from the breach.

You want to make sure your clients have all the coverage they need. Otherwise they could come up short on insurance when it matters most.

How do you do that?

Helping Your Client Take Action on Cyber Insurance

Consider your clients’ data:

• Debit Cards
• Credit Cards
• Social Security Numbers
• Email Addresses and Corresponding Passwords
• Bank Account Numbers
• Driver’s Licenses

What kind of data do they have? How much of it are they storing? And what protections do they have around that data?

At a time when the government recommends “performing proper due diligence to understand available cyber insurance coverage”, it’s essential that your clients understand their cyber liability exposures, and their coverage

Cyber insurance is complicated.

But ProWriters can help. All it takes is a little information about your client’s business–then we can help you fully understand the risks your clients face. You can also get a sense of pricing for that client.

ProWriters has over 20 years of experience in cyber insurance. Unlike money-driven agencies, we’ve focused on building relationships. It’s easier to work with someone you know and trust, and we’ve spent years nurturing and valuing the relationships with our carriers. It’s an edge profit-centric competitors don’t have.

If you have clients with uninsured cyber liability exposures, now is the time to get a quote.