What is Cyber Liability Insurance?
Companies in Northern Colorado, and all around the world, face considerable expenses when hackers or malicious software compromise personal information. After a data breach, businesses initiate reputation management campaigns, direct communication with their customers, and recovery tactics.
Each step taken to mitigate the consequences of a cyber attack comes with a price tag. First-party cyber liability insurance protects businesses against the financial impacts of cyber attacks and data breaches.
First-Party vs. Third-Party Coverage
First-party cyber liability insurance directly helps ease the financial impact of the insured business. It reimburses many of the costs associated with recovering from a cyber attack.
Third-party plans protect the business if a mistake leads to stolen customer information. This type of insurance covers legal expenses when a company is blamed for a breach. Most cyber liability insurance policies cover both first- and third-party losses.
Types of Losses
Several types of losses can affect a business as a result of cyber activities.
- Data Asset Loss: When a virus is used to destroy a business’s data or render it unusable.
- Computer Fraud: A cybercriminal accessing a business network and obtaining sensitive information.
- Business Interruption: When a cyber-attack results in a loss of income while a website is down, data is unusable, or orders can’t be processed.
- Funds Transfer Fraud: When a hacker accesses a company’s computer network and transfers money to and from accounts.
- Extra Expense: Costs incurred by a company that must go to extreme lengths to minimize their time out of commission due to a data breach (hiring new employees, flying in experts, buying protection systems).
- Cyber Extortion: A hacker threatening to damage a firm’s electronic systems or expose private client information unless a ransom is paid.
- Other Crime Losses: Expenses and loss of time incurred due to a business removing unwanted posts on their website, dealing with a spam attack, etc.
Be sure to protect your business with the best cyber liability insurance. Contact Steve Longenecker (303-808-9351, x2) at Mountain Insurance: Longmont to review your commercial insurance coverage in Longmont, CO, or our neighboring communities.
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