Cyber insurance

Cyber liability insurance for technology companies covers legal costs when a client blames you for failing to prevent a data breach or cyberattack at their business.

For example, if an IT consultant leaves data for a small healthcare company unsecured on Amazon Web Services, and a cyberattack exposes hundreds of Social Security numbers and email addresses belonging to the company's customers, the healthcare company could blame the consultant and file a lawsuit.

The consultant's cyber liability policy helps pay for legal defense costs and the eventual settlement.

Cyber insurance helps retail businesses recover after a cyberattack exposes customer information. It's recommended for any shop that handles credit card numbers or other sensitive information.

For example, an employee at your clothing store accidentally opens a social engineering email containing a malicious computer virus. The virus encrypts data crucial to your business’s operations and demands a ransom for its retrieval.

Your cybersecurity insurance reimburses you for the ransom and for the cost of hiring someone to look into the source of the attack.

Cyber insurance for healthcare organizations can help cover legal costs and provide essential resources, such as notifying clients or patients that their data was exposed, credit monitoring services for affected clients, and PR campaigns to restore reputation.

For example, a ransomware attack on a doctor's office could force them to lock their patient billing and scheduling software in order to investigate the breach and prevent further damage, affecting the office's 100,000 patients.

Cyber liability insurance would cover business interruption expenses while the facility works to reboot and upgrade security on their system.

Cyber insurance can cover legal fees and expenses for financial professionals, while also providing vital resources to help recovery if they experience a cyberattack or data breach.

For example, if a tax preparer asks a client to upload a document with sensitive data online and that client data is stolen or compromised, the affected client might decide to sue the tax preparer to recoup expenses.

Cyber liability insurance can shield your business from legal expenses related to a data breach by paying for court costs and attorney fees.

Cyber liability insurance for real estate professionals can help pay for recovery expenses while also providing resources to help aid customers affected by a data breach.

For example, a real estate agent loses a laptop containing sensitive client information. The data breach laws in their state require them to notify their customers, and they also run a PR campaign to help restore trust.

Cyber insurance provides coverage for notification costs, PR efforts, fraud monitoring services, and other related expenses.

Cyberattacks can happen when network security at a business is not up to date, or employees lack the training or knowledge to recognize phishing attempts, ransomware, and other cyber hacking red flags.

According to a recent report, 82% of ransomware attacks target small businesses. Ransomware gangs often attempt to extort companies that are lucrative enough to pay a hefty ransom, but also small enough to make hacking attempts easier, as well as keep media and law enforcement attention low during the fallout.

When a data breach or cyberattack occurs at a business, cyber liability insurance can help defray costs to the business and help a company survive the breach.

Learn more about protecting your business from ransomware attacks and other threats.

Cybercrime is a multibillion-dollar industry. Security firms constantly struggle to stay ahead of hackers looking for lucrative victims. Even with careful security measures in place, catastrophic data breaches can, and do, occur.

For example, earlier this year MailChimp suffered a second data breach where a threat actor gained access to data attached to 133 accounts through a social engineering attack. This attack is just one of many that have happened in 2023 thus far.

Phishing emails, malware, security breaches, network security issues, and computer system breakdowns are just a few examples of the kinds of cyber risks that could cause serious liability or losses.

This could impact a financial planning business that stores bank account information, or even a gaming app developer that collects user profile information.

Learn more about what to do after a data breach.

If you want to learn more about this policy, you can find additional answers in our frequently asked questions about cyber insurance.

If there are any additional questions you have about coverage or building a risk management plan, you can also contact an Insureon agent.