As a start-up entrepreneur or a small business owner, a breach of your computer systems could have a devastating impact. Whether it’s a hacker accessing your customer database or your human resource files, or an attack that leaves your website down or disabled, it’s a modern liability that you need to protect yourself against.
Unsurprisingly, while government regulations are still a step behind on prosecution of hackers, the insurance industry is current with an offering known as cyber liability insurance.
The Chubb Group, one of the largest insurance companies in the United States, recently conducted a survey of public companies, asking executives to identify their top liability concerns. While cyber security came in at number one, the majority of CEOs — 65 percent of those polled — don’t have cyber risk insurance.
It can be easy to think that this sort of loss, whether it’s customer or employee information, or revenue from website downtime, is covered by a corporate insurance policy. There are some business insurance policies that offer limited coverage under general liability, but there are still large gaps that likely won’t be discovered until it’s too late. General liability insurance usually doesn’t cover losses that come as a result of the Internet and in some cases even makes a point to exclude such losses from coverage. If your business is reliant on the Internet to grow your business, connect with clients, and to generate revenue, then cyber risk insurance can be a needed supplement.
Many cyber liability insurance policies offer what’s referred to as “first party” coverage. This means that business interruptions (such as one stemming from website downtime) are covered, as well as additional expenses like advising your customer base of the breach. In the case of a small business, this type of coverage is critical to ensure that your revenue is protected and you get back to work as soon as possible.
Still want to learn more about what cyber liability insurance really is? Minda Zetlin has more, along with six reasons why you should get cyber liability insurance, over at Inc.