Cyber Insurance Blog

Why Every Business Needs a Cyber Policy

Why Every Business Needs a Cyber Policy

If there has ever been a time for your clients to grasp the very real risks they’re facing, it’s now. With cyber attacks up 37% in the past month, and as much of our nation’s workforce and education systems shift to remote capabilities, cyber criminals are taking advantage of the chaos and unleashing more attempts than ever before. It’s time for your clients to confront the potential damages they could be facing and protect themselves with a cyber policy.

If nearly all organizations are at risk, why are so many still uninsured? Many business owners don’t understand the potential damages and costs of a cyber attack or how they could potentially be affected, along with their customers and business associates. But in a world in which nearly every industry utilizes technology, it’s time for your clients to accept their risks and make a decision to defend themselves.

Does your client use online banking? They’re at risk. Do they utilize email for correspondence? They’re at risk. Do they rely on gathered data in their daily workflow? They’re at risk.

Many small business owners don’t feel they’re a target due to their size. They assume that hackers would reach for the deep pockets of a large corporation over them. In reality, large corporations generally have the funds for extensive IT teams and cyber security. While a successful attack against a large company would be financially enticing for a hacker, a small business with little to no IT security team is a much easier and quicker target. One in five small businesses face a cyber attack on their information security and, of those, many aren’t prepared to deal with the consequences.

How Does a Cyber Policy Help?

There are a number of common misconceptions about the coverage a cyber policy offers. Many think there’s no point in purchasing a cyber policy since it doesn’t cover much. In reality, many businesses have attempted to pursue claims for a cyber attack through the wrong type of policy, which simply doesn’t cover cyber claims. Cyber coverage has adapted over the years and now provides broad, comprehensive coverage for potential cyber claims.

Cyber coverage protects your clients from both first-party and third-party exposure:

First-Party Coverages

  • Close up of hands typing on a laptop keyboard with graphics of padlocks overlaying the image. IT forensics: The cost to determine where or how the breach occurred and what information/data was compromised.
  • Notification costs: The costs to notify all parties who may have been affected by the breach.
  • Credit protection costs: The costs to provide credit monitoring to all who may have been affected.
  • Crisis management costs: The costs to hire a public relations firm to assist in publicly responding to the breach.
  • Crime & social engineering: The coverage of a potential “voluntary parting of funds” attack in which an individual is tricked into either sending funds to a hacker or providing access information to an account.

Third-Party Coverages

  • Claims related to the breach of Personally Identifiable Information (PII): This includes credit card numbers, social security numbers, bank account information, personal health information, private corporate data, and other sensitive information.
  • Third-party liability claims for:
    • Breach of contract
    • Negligent protection of data
    • Network security breaches
    • Transmission of software viruses
    • Denial of service attacks
    • Defense of regulatory actions related to a breach
    • PCI fines and penalties and assessments
 

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Additional Coverages

  • Multi-media coverage: This can cover online advertising, intellectual property, copyright and trademark infringement, and libel or defamation claims.
  • Cyber extortion: This provides coverage for a potential ransom demand made during extortion.
  • Cyber business interruption: With most organizations relying heavily on the internet, this coverage is available should your network or system be held at ransom or compromised. This may also include dependent business interruption.
  • Hacker damage or digital asset damage: This can provide coverage to repair or rebuild your client’s website, intranet, network, or electronically-held data.

Why ProWriters?

ProWriters offers excellent risk management and loss prevention services, which may help your clients avoid a cyber attack altogether. Should a hacker gain unauthorized access to your client’s network or system, ProWriters provides exceptional post-breach services. This includes a breach coach to quickly enact their predetermined incident response plan so your client can respond immediately, as well as access to all of the best vendors to assist them with the recovery.

ProWriters strives to make your job even easier by providing the fastest way to instantly compare multiple quotes from multiple carriers with our Cyber IQ Comparative Rate Portal so you can find the right insurance company and policy for your specific client.

In addition, ProWriters offers brokers a number of marketing materials, educational resources, and risk management resources. Check out our FREE eBook, How to Sell Cyber: Big Claims in Ransomware & Social Engineering.

To get started, contact us or call 484-321-2335 to speak with a ProWriters expert today.

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