The massive growth of technological innovations has exposed businesses to cyber threats. Small businesses are vulnerable to malware attacks, phishing, and ransom attacks.
According to Reuters, a recent cyber attack targeted approximately 1000 businesses worldwide. The attack affected key functions like cash registers for small businesses like preschools, retail stores, and dentists, paralyzing their operations.
Cyber attacks on key functions or data can cause disruptions leading to massive losses and brand erosion. Therefore, it’s essential to acquire cyber liability insurance to shield your business against related losses.
Here’s what you need to know about cyber insurance for small businesses.
Benefits of Cyber Insurance to Small Businesses
Typically, cyber attacks target strategic assets of a small business, like applications, databases, devices, networks, and users. Following a cyber attack, systems or business assets are compromised, leading to loss of revenue, disruptions, and failure to meet orders.
A cyber insurance policy can meet the following costs following a cyber attack:
- Legal fees for lawsuits following privacy violations
- Restoring altered or stolen data
- Paying ransom demands following cyber attacks
- Hiring forensic experts to investigate, restore networks, and recover compromised data
- Notifying customers whose data has been affected by ransom attacks
It’s worth noting that cyber insurance excludes preventable cyber attacks—for instance, a poor configuration of networks or negligent handling of digital assets. What’s more, it excludes cyber attacks initiated by employees, the cost of improving technological systems, or pre-existing breaches before acquiring insurance.
Cyber Insurance Coverage
Business Interruption Coverage
Most businesses largely depend on an operating network to access customer databases, invoices, supply chains, and other key functions. A cyber attack that targets a key function like sales is a source of operational risk.
Business interruption coverage caters to fixed expenses, lost income, and additional expenses the firm incurred during the attack.
Network Security
A small business exposed to information and privacy risk should consider procuring network security coverage. It protects the business from a network security failure that leads to data breaches, business email compromise, cyber extortion, or malware attacks.
Network security coverage caters to the cost of data restoration, public relations, negotiation and payment of ransom demands, notifications, and forensics.
Privacy Liability
Typically, data breaches target key data like customer or employee information. A cyber attack on a customer or employee database results in privacy violations and business liability. Privacy liability coverage is therefore essential to meet the cost of defending the business against class suits and settlements.
Media Liability
Media liability coverage is essential for media-related businesses like publishers, broadcasters, and video or film producers. It offers protection against liability associated with intellectual property infringement, patent infringement, plagiarism, or defamation.
Therefore, a business needs media coverage to protect against the cost of settlements, defense, and legal suits associated with media liability.
Try Our Cyber Insurance Liability Services Today
A competitor can use a cyber attack to destabilize business operations, leading to losses. You, therefore, need insurance to cover cyber risks. At Panorama Insurance Agency, we work closely with our clients to find a tailored insurance policy.
Contact us online or call us at 818-781-6630 to get your quote.
