Cyber Insurance

In this age of modern technology, insuring your information technology structure is a vital component to your portfolio. While technology can enhance your business model and simplify many tasks leading to better profitability, there are many inherit risks and exposures that can be costly. Due to this new era of information technology, most business liability policies do not protect against cyber attacks and breaches. Injury or physical loss policies have no application to this type of electronic risk and the costs they may incur. Cyber exposures can range from the content on your website server to your stored customer data that you have on your local, day to day computer network. Potential cyber liabilities can cripple your operations so you need to manage your risk accordingly with proper coverage.

Here is a list of possible exposures that you may need to cover:

 

Data Breaches: Government regulations have placed the responsibility of protecting clients’ personal information solely on the companies collecting this data. If a breach occurs, the company has a legal obligation to notify all affected parties. Security fixes, identity theft protection and protection from legal action are but a few of the costs involved in a breach. Companies operating online have increased risk but even those who do not transmit personal data over the internet and store most client information in electronic form could still be susceptible to breaches and data loss through local network vulnerabilities, unauthorized employee access or theft.

Intellectual Property: No matter how you manage your online presence, whether through a website, blogs, social media or advertising, your intellectual property can be at risk. Your tangible and non-tangible assets can be exposed to a number of intellectual property violations. Patent, copyright or trademark infringement, design and trade secrets theft, libel and/or defamation are but a few examples that should be covered.

Secondary Damages: If an email goes through your server, whether it is someone in your company or a malicious party, that contains a virus that causes damage to another party and their systems, you could be liable for any loss incurred. Also, if you distribute any software or data files that cause another party to have crashes or outages, liability can become an issue.

Data Loss or failure: A loss of data or a network wide system failure could be the result of several factors: natural disaster, malicious activity, fire, user error, etc. While physical damage to your hardware could be covered under an existing business policy, data loss would not be included. Therein lies the need to cover any financial damages you may incur from data loss.

Extortion: Cyber criminals are capable of illegally accessing websites, networks, stored data and denying you and your clients’ access to the information. They will often demand payment to restore your systems. This can cause loss of revenue and time and even generate additional losses associated with their demands. If your systems have been damaged and made vulnerable due to the breach, a technological restructure can also be an additional cost.

Business Interruption: As stated previously, we now rely heavily on technological resources to increase our productivity and financial profits. Any disaster that can cripple your ability to utilized or provide electronic services to your clients could be a potential revenue loss. From network or system failures to data breaches, your day-to-day operations can be at risk. Time and resources then have to be reallocated to deal with these issues which could lead to further revenue losses. Denial of service attacks have been on the rise and while there are 3rd party solutions to mitigate these types of attacks, any type of illegal cyber activity that interrupts your business operation for any amount of time can be problematic and costly.

Cyber liability insurance is designed to address the risks that come with using information technology in this modern era. The amount of coverage your company needs is based on the range of your operations and total exposure. NASTC Insurance can help identify your areas of risk and customize a policy to fit your needs.