With the increasing awareness of the threat of hackers invading complex systems and stealing valuable and confidential information, most businesses are making the smart decision to invest in cyber insurance as a way of mitigating their risks.
There are two major types of cyber liability insurance: first-party coverage and third-party defense and liability coverage. First-party coverage offers the insured financial compensation in order to help them address any and all of a customer’s immediate business needs, while third-party coverage protects your client in the event of a lawsuit brought by a customer or partner in the event that a data breach occurs.
First-Party response to a claim
The following is a list of costs to be covered, which is dependent on the type of policy that is in force:
- Legal and forensic services to determine whether a breach occurred and assist with regulatory compliance if a breach is verified
- The costs involved to notify affected customers and employees that a breach has occurred
- Customer credit monitoring to ascertain whether or not a customer has been directly affected by the breach
- Crisis management and public relations to educate customers about the breach and also restore a company’s reputation
- Related business interruption expenses, and
- Cyber extortion reimbursement for perils including credible threats to introduce malicious code; pharm and phish customer systems; or corrupting, damaging your clients computer system
Third-Party defense and liability
The following will likely be covered, but again, this is dependent upon the policy purchased:
- Judgments, civil awards, or settlements a client is legally obligated to pay after a data breach
- Electronic media liability, including infringement of copyright, domain name, trade name, service mark, or slogan on an intranet or Internet site
- Potential coverage for employee privacy liability as well as network security and privacy liability
Contact an expert that has a track record and the necessary experience to deal with this evolving area of coverage. You need to partner with someone that has access to top carriers, is able to customize policies, and can address the unique business exposures of your clients. Don’t wait for a cyber threat to happen; give your clients the protection they deserve before it’s too late!