Cyber liability insurance is a bit different from the type of insurance that many business owners are used to: there is no set standard for coverage. Whereas if you have BOP insurance for your business, your policy will typically have specific coverages such as property damage, theft, and business interruption. This can be great for universal coverage for your business. However, cyber liability insurance is much more of an “a la carte” type of program. You essentially can purchase each of the protection modules that will benefit your business. This allows you to really fine-tune your cybersecurity coverage to fit your needs.
Let’s take a closer look at six common myths and misconceptions about cyber liability insurance.
Hackers only target high-risk businesses.
Hackers can target any business, no matter the size. If your business has access to technology, a hacker can likely find a way in. Hackers are quickly becoming more sophisticated in their methods and can even automate attacks to occur simultaneously. Oftentimes, small businesses are actually targets because of their perceived lack of technological resources by hackers. Your cyber liability insurer can help you understand the risks associated with your business and industry.
Hackers are only looking for financial data.
While the end goal of the hacker is clearly financial, the hack may not begin with a breach of financial data. The hack may begin with the hacker infiltrating internal administrative systems to pull usernames and passwords to aid in the attack. Even if the hack doesn’t reveal financial data, the goal of the hacker may have been to sell your customer or employee data to a third party. Cyber liability insurance can help you plan accordingly in all areas of your business.
Cyber liability insurance is too expensive.
The cost of cyber liability insurance will vary based on the level of risk in your industry and a variety of other factors. Typically, a small to medium-sized business will pay anywhere from $500-$1,000 annually for cyber liability insurance. As the risks and size of the firm grow, the cost of insurance in all areas will grow as well. For more information, check out our article How Much Does Cyber Liability Insurance Cost?
Simply an IT team is sufficient for cyber security.
Your IT team may be great, but IT doesn’t equal cyber security. Cyber security and IT are completely different. Where IT may handle more day-to-day tech problems, programming, and coding, cyber security focuses solely on the safeguarding of digital data and information. Your cyber liability insurer can help you identify how to incorporate your IT team into your cyber security plan.
You are not liable for third-party hacks.
If your vendor or another third party that has access to your systems were to be hacked, their computers may have a way to communicate with one another to spread the virus or malware. In this case, your business would be damaged as a result. Vice versa, if you were hacked and your vendors or customers were damaged as a result, you could be held liable for their damages. There are many reasons why you should consider cyber liability insurance other than third-party liability, for more information, check out our article 10 Reasons to Get Cyber Liability Insurance for Your Business.
Cyber liability insurance is only for businesses.
While most cyber liability insurance may be targeted toward business owners, there are some insurance agencies that provide personal lines of cyber liability insurance. Personal cyber liability insurance could be beneficial if you are at risk of a personal cyber loss.
If you’re in the market for cyber liability insurance, keep these common myths and misconceptions in mind. Whether you’re a small business, an organization with a few dozen employees, or a large conglomerate, the need for cyber liability insurance is clear. The cost is minimal for the peace of mind that comes with a solid cyber liability insurance policy.