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Why Does My Business Need Cyber Risk Insurance?

Why does my company need Cyber Risk Insurance?

  • Does your company have employee records?
  • Does your company have customer information?
  • Does your company take credit cards?
  • Does your company have healthcare information?
  • Does your third party software vendor assume any liability?

Companies that keep any electronic or paper customer or records could be at risk for a data breach.

What can happen to cause a data breach?

  • Lost or stolen laptop or flash drive
  • Unauthorized employee conduct (employee stealing data)
  • Employee error
  • Hacker

Doesn’t my General Liability or Business Owners Package cover our company?

  • General Liability & Business Owners Packages do not automatically include coverage for cyber risks.
  • Beginning with June 2014 renewals there is a mandatory endorsement that specifically excludes access or disclosure of confidential or personal information and data related liability.

What would a data breach cost my company?

  • 2014 Poneman Institute study estimates average cost of a data breach as $201 per record. 100 records=$20,000, 250 records=$50,000, 500 records=$100,000, 1000 records=$200,000
  • Can your business absorb that size of a loss?
  • Nearly 60% of small businesses victimized by a cyber attack close within 6 months of the attack. (Symantec 2010)

What is my company’s obligation in the event of a data breach?

  • Perform computer forensics to determine the cause and scope of the breach.
  • Notify affected individuals (or all if unable to determine specific individuals).
  • Each state has laws regarding the timing, content and required information in the notice.
  • Most states require you to provide credit monitoring for one year.
  • Potential fines or penalties.
  • Have a public relations firm help to minimize the impact on my business.
  • Have you identified experts who can assist you with these items?

How does my company get protection?

Morrow Insurance has resources to assist you. Your agent will recommend the company and coverages that are the best fit for your business. They will review the insurance application with you and make sure that your company is implementing best security practices. Insurance companies want to make sure that your company has implemented basic standards to minimize your exposure. Contact your Morrow Insurance agent today to begin the process.

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