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Why Businesses Need Cyber Liability Insurance Now More than Ever

By February 16, 2021April 28th, 2021Insurance

All businesses today rely on modern technology because it is a convenient, reliable and efficient way to operate. However, it comes as no surprise that convenience comes with a price. 

Computers have been in homes for years and have gained the trust of their users. Every day people are browsing the web, putting their personal information on websites and apps because they are believed to be secure. While oftentimes this is the case, unfortunately new technology has also led to hacking and computer viruses that have the potential to put all of your data and privacy at risk. 

Back when people were still using paper, the biggest risks they could face were a fire, theft or flood. Today, all of this valuable information is stored on databases and personal computers, and cyber-criminals have taken advantage of this and pose threats to basically every business out there. With just a simple click of a button, hackers have the ability to access any private, confidential information businesses have in their records.

Major benefits of cyber liability insurance in South Dakota 

Living in the age of technology has given businesses the luxury of becoming more efficient and successful, but has also introduced higher risks of security breaches. When these types of attacks occur, they can cause irreversible damage to any business. Businesses will often have to deal with business disruptions and a loss in revenue. It is crucial to understand that no business, no matter how big, is immune to cyber crime. 

This is why cyber liability insurance is more important now than ever. The policies are tailored to meet your company’s needs and can offer a number of significant benefits including:

Data breach coverage

When a data breach occurs, businesses are required to notify all parties that have been affected. Security fixes, identity theft protection for those impacted, and protection from possible legal action can all add to the overall data breach costs. Cyber liability policies will include coverage for these exposures to secure your data from cyber-criminals. 

Business interruption loss reimbursement 

Cyber-attacks often lead to IT failure that will surely disrupt business operations, ultimately costing your business valuable time and money. Cyber liability policies may cover your loss of income during these unpredicted interruptions. Additionally, increased costs to your business operations after the cyber attack may also be covered.

Legal support 

It’s normal for businesses to feel overwhelmed and panicked after experiencing a cyber-attack, and oftentimes they will seek legal assistance, which can be very expensive. Cyber liability insurance can help businesses afford proper legal work after the events of a cyber attack. 

Forensic report

After an organization has experienced a cyber attack, it will be necessary to investigate to determine the extent of the breach and what led up to it. If you choose the right policy, you will be reimbursed for the costs related to the forensics and seeking expert advice. Furthermore, some policies will be able to provide 24/7 support from cyber specialists. 

Defense from cyber extortion

Malicious software, such as ransomware, is designed to steal and withhold valuable data from organizations until a steep fee is paid. With these types of attacks increasing, it is important for organizations to invest in cyber liability insurance, which can help recoup losses resulting from cyber extortion.

Provides coverage beyond a general liability policy

General liability policies do not typically protect organizations from losses that are related to data breaches. Additionally, data is generally worth much more than physical assets, making it super important to have the proper protection in place in the chance of a cyber attack. Cyber liability insurance can give you the peace of mind that in the event of an attack, your organization’s repetitional well-being is protected.

What is not covered by cyber liability insurance?

It’s important to carefully read through your cyber liability insurance policy and understand what is included and what is not.

Commonly, cyber liability will exclude:

  • Loss of property 
  • Criminal activity 
  • Social engineering
  • Property damage

When you choose a cyber liability insurance policy, you are agreeing to maintain security measures in order to prevent a cyber attack from happening in the first place. If you fail to maintain these measures, it could affect your coverage. As an example, if an employee were to click on an email that causes malware to corrupt the company’s systems and the company did not install anti-malware software, the insurance company can deny the claim. 

Choose a Trusted Independent Insurance Agency in South Dakota

Meyer Insurance promises to protect you from life’s unexpected twists and turns. We understand how important your family, business and possessions are, and have the experience to navigate the unique risks you may face. 

We have two office locations in Watertown, SD, and Webster, SD. Our agents are ready to assist you with all of your insurance needs. If you are interested in learning more about our independent insurance agency, contact us today to speak with one of our professionals. 605.753.5698