The "Legal-Ease" Glossary
Cyber Liability Insurance, First-Party Response
This is an insurance policy that covers the cost to respond to a hack or data breach on your computers.
First-party Cyber Liability Insurance offers coverage for business owners in the event that a data breach compromises sensitive client information. It helps you pay for immediate actions, such as…
- Credit monitoring. After a breach, you may need to keep an extra eye on your finances, public records, and other information to prevent fraud.
- Good-faith advertising campaigns. Did you know that the public thinks oil spills are only marginally more damaging to a business’s reputation than data breaches? It’s true. That means if your small business suffers a breach, you have some work to do to restore your reputation and rebuild the public’s trust. Luckily, first-party Cyber Liability coverage can help fund your PR moves.
- Breach notification. This comes in handy when you must notify your customers and clients about the breach. Most state laws require you notify affected parties that their sensitive information has been stolen within a certain timeframe.
- Cyber extortion. Fingers crossed a never cybercriminal holds your data hostage and you don’t have the funds to negotiate with them. Small businesses have been run into the ground thanks to sophisticated distributed denial of service (DDoS) attacks, which keep a business or website offline.
The aftermath of a data breach can quickly become an insurmountable mess and PR nightmare. That’s why Cyber Liability Insurance is quickly becoming a necessity for small businesses that rely on their computers, websites, and servers to operate. This coverage won’t prevent a data breach or cyber attack, but it does offer you a way to get back on your feet after a hit.
For more information about Cyber Liability Insurance, read our blog post "4 Reasons Your Business Should Have Cyber Liability Insurance."
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