Your Guide to Cyber Liability Insurance

cyber crime criminals hacking into network

One of the groups that benefitted from the COVID-19 world wide outbreak is cyber criminals. Overall, Cyber crime has shot up to new heights by close to 300% since the start of Covid-19 — and it’s still seems to be on the rise.

Quick Facts:

  • Small businesses account for over 40% of cyberattacks target .
  • In the past 12 months over 60% of small businesses have experienced a cyberattack .
  • Research has shown that over 45% of small businesses say cyber security processes are ineffective at mitigating attacks.

They protect organizations against malicious attacks, and Nexigen recommends a multi-prong strategy.  In addition to reducing your risk with a comprehensive cybersecurity plan, we recommend that you consider Cyber Liability Insurance (CLI).   Cyber Liability Insurance (CLI) covers the financial loss that results from cyberattacks such as data breaches.

Why you should Invest in Cyber Liability Insurance?

Having cyber liability insurance could be the key difference between your business going out of business or continuing forward after a security incident. In the event of a severe data breach, good cyber liability insurance could cover:

  • Cost of downtime
  • Cost of investigation
  • Cost of recovering data
  • Cost of legal procedures
  • Cost of notifying stakeholders about the incident
  • Cost of restoring the personal identities of those affected

Any business with cyber exposure can benefit from cyber liability coverage. But if your business handles or stores sensitive information online, such as electronic protected health information or personally identifiable information, cyber liability insurance should be your top priority.

Finding the Right Coverage

While many insurance providers offer plenty of general liability coverage options.   Some insurance providers don’t offer a comprehensive cyber liability coverage plan. When a business is doing research nexigen recommends they look for insurance providers rated highly by the most reputable insurance rating agency. Nexigen has personal interactions and recommends the following carriers:

  • RiskSource – Cincinnati Based Insurance organization with over 4000 clients nationally.  https://risksource.com
  • McGriff – McGriff is part of Truist Insurance Holdings, Inc., one of the top 10 largest insurance brokers in the world. https://www.mcgriff.com

You’ll also want to ensure your cyber security liability insurance plan includes the following:

First-party coverage:

  • Network security and privacy liability: Covers breach response costs like forensic investigations, public relations, credit monitoring, legal fees and fines/penalties
  • Business interruption losses and extra expenses: Covers lost revenue and added costs to continue business
  • Digital data recovery and cyber extortion expenses: Covers losses such as ransom paid due to ransomware

Third-party coverage:

  • Cyber liability: Covers claims of lawsuit expenses resulting from breaches in client systems or networks
  • Media liability: Covers claims of libel, copyright/trademark infringement, etc., resulting from media use

Cybercrime coverage: Covers losses from digital theft of money or securities and social engineering fraud

Please reach out to learn more from our cyber security team.  From building a cybersecurity plan to helping you identify the cyber liability coverage that best suits your company’s unique needs, our security experts are here to help.

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