Cyber Liability in Today’s Business Environment

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Cyber Liability is a hot topic in the insurance industry these days for both agents and their customers. Businesses are under attack daily and it is important for insureds to identify their exposure, understand their coverage if they have it, and make a concrete decision if they have enough.

Hello, my name is Chip Fridrich and today our topic is the very prevalent threat of cybercrimes, how they can impact your business, and how you can protect your company through insurance. Common cyber crimes include the acts of ransomware, email phishing, and business email compromise (just to name a few). Any business that is in possession of sensitive information on their network systems is in danger. This would include records involving customers and their social security numbers, credit card information, bank account numbers, or tax records.

As step number one, any business that has this type of information should hire a professional computer consulting service to lock down the network in the safest manner possible with firewalls and encryption protocol.  Companies should have written rules about the safekeeping of important data devices. These policies should be updated continually. A single breach into your network can be very costly due to the steps that are required by law in today’s world regarding notifying your customers about the intrusion.

Rules should also be in place as to the handling of money which would include wire transfers and sending checks or funds to unknown or unfamiliar entities. Employees should be told step by step what to do when they believe they have been hacked or deceived. Simple rules regarding password protection of email accounts and important system components can go a long way to be a deterrent.

According to a recent report in IA (Independent Agent Magazine), 94 percent of small businesses believe they face cyber of data breach risks. These risks are at the forefront of worries for all businesses in today’s environment. Simply stated, if your business does not have a plan you need to because it is not a matter of if your business is targeted, it is when. Cyber criminals are getting smarter by the day, their networks are growing, and their techniques are becoming more advanced.

The insurance coverage for cyber liability is ever changing. One should never assume that they have coverage because many businesses do not. In fact, it is estimated that only thirty three percent of all commercial insureds have this protection. If you do, your limits may not be enough, or you may not have the proper endorsements on your policy.  Many companies think that their coverage would come from their General Liability policy but in most cases this exposure is excluded in the GL policy language As I mentioned and to reaffirm, one breach can be large enough to take your company down.

I urge you to call our office for a no obligation audit of your current program in its entirety which would include your potential coverage gap regarding cybercrimes.  The quoting process for this coverage is quick and hassle free and our Agency has the markets to give you options for plans that are broad and competitive in their pricing.

Our Agency’s mission is to provide personalized service, professional guidance, honest answers, and quality insurance products- all in a boutique yet highly experienced manner. If you are interested in knowing more about our Agency, contact us at info@fpa.insure.

 

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