Updated February 2019
Cyber insurance is commonly mistaken for something only big corporations need. It can be looked upon as an unnecessary expense, and the ins and outs of how a policy will protect your company aren’t fully understood. However, in today’s world, when your business stores most of its information online or on a particular server and relies on an uninterrupted WiFi signal to work, it’s essential. That’s why we’ve devoted today’s article to helping you understand your cyber insurance needs, by answering the most common questions.
1. Why is cyber insurance important?
Cyber insurance protects your business and its data. While it’s all too easy to think that the only cyber security threat comes from hackers, who wouldn’t be interested in attacking your business, unfortunately, that’s not the case. Security threats come in all shapes and sizes and aren’t all the result of malicious actions. From an employee accidentally hitting ‘send’ to the wrong recipient when discussing confidential dealings, to a damaged WiFi router interrupting work, to opening an innocent looking message with a nasty virus, there is a range of ways using the internet can hamper your business as much as it aids it.
2. What exactly is cyber insurance?
Cyber insurance mitigates the repercussions of a data breach. Essentially, it makes sure your company is financially secure in all of its online activity (as long as it’s legal). It covers the costs caused by loss of data, leaked information and network interruptions. It even covers the cost to your reputation, and any expenses involved in responding to the situation. And yes, your policy will safeguard your business if your database is hacked.
3. Who needs cyber insurance?
If your business relies on information technology, you need cyber insurance. In particular, businesses that store sensitive client information should be investing in a comprehensive policy. For example, if you’re a financial institution and details of your client’s business dealings leak, you could face a serious lawsuit. Similarly, if you’re a medical centre that stores patient records, you need to have measures in place to protect yourself if the information is compromised.
However, it’s just as important for any other businesses that rely on an internet connection to complete their work. From digital design agencies to gyms that use online booking systems – if you use a computer in your business, you need cyber insurance.
4. When do you need cyber insurance?
Your company should have a comprehensive policy in place at all times. Though insurance can be seen as something that’s only relevant if your systems are undergoing updates, or your security measures are temporarily not in place, sadly that’s not the case. Even businesses that are doing everything right can be the victims of cyber crime, or accidental mishaps.
You should also look into cyber insurance if you contract vendors to do digital work on your behalf. After all, if they make an error or omission in their work that has consequences, you may be liable for a claim. As a result, you should make sure your policy includes a clause protecting your finances if a claim arises because of work a contracted company has completed.
For more information on how cyber insurance will protect your business, check out our customisable policy, or contact our expert team of underwriters today. We’d be happy to discuss your business’s needs!
Other useful cyber insurance news items:
The Top 3 Cyber Threats in 2017
4 simple reasons why you should have Cyber Insurance
Cyber Insurance, A Business Essential?
How to Insure your Business against Cyber Security Risks
