As more and more of what we do relies on computer networks and internet connections, cyber liability has emerged as a major risk for businesses. Cyber attacks can cost millions, and many companies are unprepared for a major breach. Even those who do prepare are learning that there’s no silver bullet when it comes to cyber security. This creates the need for cyber liability insurance: a product that directly addresses the cyber risk clients now face.
At ProWriters, our experts have access to the latest cyber liability insurance information and trends to help brokers and agents place the right coverage for their clients. Our team is dedicated to streamlining and simplifying a complex and evolving cyber landscape for brokers and agents. Learn about the direction of cyber privacy liability coverage, what’s included in a policy, and how to find the right one.
Why Buying Cyber Liability Insurance is Worth it for Clients
Business owners often underestimate the benefits of cyber insurance. Because it’s not mandated, they often underestimate the value of it until a breach occurs. Clients should treat cyber risk liability insurance like catastrophic insurance—something they have in case a major cyber incident occurs that would force the business to go under. Viewed this way, cyber insurance offers enormous value for clients.
Without cyber insurance, a data breach can be devastating. 60% of small businesses that are the victim of a cyber attack go out of business within six months. With the average cost of a breach rising year after year, it’s no surprise businesses are unable to handle the expenses out of pocket. This is what makes cyber liability insurance such an excellent value. The small premiums a client pays are relatively inexpensive and well worth it when compared to the costs of a breach. In short, adequate cyber insurance coverage can be the difference between a business surviving a cyber attack or becoming another statistic.
Why Selling Cyber Liability Insurance Is Worth it for Agents and Brokers
The US cyber market has experienced significant growth in recent years, presenting opportunities for agents and brokers. Direct premiums written for cyber insurance—including standalone and packaged policies—exceeded $2 billion in 2018. This is more than double what was written just a few years earlier in 2015.
In addition to sustained growth, cyber insurance has proven to be profitable. The ratios for direct paid loss and defense and cost containment expenses were healthy, coming in below 25 for cyber insurance. This includes both standalone and packaged cyber policies. The profitability of cyber insurance has attracted more insurers to the market as well. 2018 saw a 12% increase in US insurers offering cyber insurance over the previous year.
The rate of growth, combined with the attractive profitability, makes cyber a strong product for agents and brokers to sell. As more and more businesses realize the value of cyber, these trends are expected to continue as the market approaches maturation in the US.
What Cyber Liability Insurance Covers
Today’s cyber liability insurance is more robust and comprehensive than ever before. Policies are constantly evolving to cover a wide range of risks across virtually every industry. The coverage we offer at ProWriters has broad first- and third-party coverage and can be tailored to meet the needs of your clients.
First-party Coverage of Cyber Breach Costs
- IT Forensic Costs
- Notification Costs
- Credit Protection Costs
- Crisis Management Costs
- Crime and Social Engineering
In addition to first-party coverage for business owners, a cyber policy will also include third-party coverage for costs related to a breach of Personally Identifiable Information (PII). PII can include information like credit card numbers, social security numbers, or personal health information.
Third-party Coverage of Cyber Breach Costs
- 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 as well as possible fines and penalties
- PCI fines and penalties and assessments
Always Work with a Cyber Expert
No matter what kind of cyber policy you’re looking for, it’s very important to work with an expert.
The cyber insurance market is constantly changing, and you’ll want someone with a lot of experience to help guide you to the right coverage. The risks are evolving too—cyber criminals are getting more sophisticated, and new threats can lead to a need for new approaches to coverage and risk management. A cyber expert with technical and insurance experience can help you and your clients navigate this evolving landscape.
An expert can also help you discern the difference between good policies and inadequate policies. This is important, because inadequate coverage not only puts your clients at risk, but also brokers and agents at risk. An inadequate policy leaves D&O liability exposure for the broker, which is something a cyber expert can help you avoid all together. Because there are so many misconceptions about what cyber insurance does and doesn’t cover, it’s easy to get the wrong insurance or under-insure a client. The right expert won’t let that happen.
At ProWriters, we have the expertise you need to obtain the right policy for your clients. We bring more than 25 years of experience to the market and have spent those years building crucial relationships that we can leverage to help you. We know what to look for, what to ask for, and how to negotiate terms when it comes to cyber insurance—and we’re dedicated to using those skills to simplify the process for brokers and agents.
To simplify things even more, we’ve also created the Cyber IQ Comparative Rate Portal, a streamlined insurance solution for the modern broker. Our portal allows brokers and agents to compare multiple quotes from multiple top carriers in just minutes using an intelligent interface designed to save time and efficiently identify the right policy for any client. Once you try our portal, you won’t want to compare cyber policies any other way.
As cyber insurance continues to evolve, the right expert will track the trends and provide you with the latest cyber liability insurance information so you can make an informed decision for your clients. To find out how the experts ProWriters can serve those needs for you and your clients, contact us today.