ProWriters’ Cyber IQ Platform Makes Cyber Much Simpler

Cyber Insurance addresses the coverage gaps other insurance products leave open.

Commercial General Liability (CGL) policies don’t cover the many expensive costs associated with ransomware attacks, social engineering schemes, unauthorized fund transfers, and other cyber incidents.

As illicit cyber activity grows, so does the need for Cyber Insurance. Experts warn cyber crime could cost the world economy $10.5 trillion a year by 2025.

Small and medium-sized businesses (SMBs) are particularly vulnerable. Approximately 43% of all cyber attacks target small businesses, many—if not most—of whom don’t have the time, personnel, and/or resources to build the truly comprehensive, effective cyber security infrastructure they need.

Enterprises of any size doing business online or storing records electronically need dedicated Cyber Insurance. ProWriters offers streamlined, easy-to-use tools and services to help brokers find protection for their clients.

The comprehensive, competitive policies available through ProWriters help businesses survive a cyber incident’s initial costs and mitigate future fallout.

Policies cover first- and third-party costs associated with data breaches and other cyber incidents.

First-party costs include:

• Ransom payments
• Involuntarily transferred funds
• IT forensics
• Notification
• Credit protection
• Crisis management
• Losses due to business interruption

Third-party costs include expenses associated with claims relating to:

• Breach of contract
• Negligent protection of data
• Network security breaches
• Transmission of software viruses
• Denial of service (DoS) attacks

Third-party coverage also applies to legal defense fees, court costs, fines, penalties, and assessments.

Cyber Liability costs can prove catastrophic. Here are two examples, with costs based on actual Cyber Insurance claims.

• Incident #1: Ransomware Attack
  A part-time employee at a small e-commerce business opens a phishing email. As a result, the business falls victim to a ransomware attack that encrypts vital company files. The criminals will provide the decryption key only if paid.
  Total cost to the business: $68,000.
  Assessment: Ransom alone can be expensive. In 2022, cyber security provider Delinea found the average ransomware payment reached nearly $1 million—71% higher than in 2021.

  But associated costs, such as business interruption or reputational damage, make cyber incidents’ true price tag even higher. The global average cost of a data breach in 2022 reached an all-time high of $4.35 million, per IBM and Ponemon, and $9.44 million in the U.S.

• Incident #2: Personally Identifiable Information (PII) Theft
  Cyber criminals target a medium-sized accounting firm. They successfully perpetrate a data breach and steal files containing clients’ PII—names, addresses, Social Security numbers, and more.
  Total cost to the business: $188,000.

  Assessment: Associated costs include notification expenses, regulatory defense, fines and penalties, and lost revenue. Fallout from a targeted cyber attack can be painful for any enterprise’s bottom line—and could prove fatal for SMBs.

  In 2021, IBM and Ponemon found the average cost of a data breach for small businesses was $2.98 million, and only slightly lower ($2.63 million) for medium ones.