Cyber Liability Insurance
Words of WisdomWE TELL OUR CLIENTS THAT THERE ARE THREE CALLS TO MAKE AFTER A SERIOUS CYBER BREACH. FIRST, CALL YOUR IT SPECIALIST. SECOND, CALL YOUR ATTORNEY. THIRD, CALL A HEADHUNTER BECAUSE SOMEONE WILL BE BLAMED FOR THIS. ARE YOU THE RESPONSIBLE PARTY WHO DID NOT PURCHASE CYBER LIABILITY?
What is Cyber Insurance?Cyber liability insurance is like any other type of business liability insurance; it is specifically designed to protect your business from third party claims from others as well as pay to help your business recover from a cyber/data breach event. Typically, the loss is from lawsuits from clients or customers for the loss of their data or the cost to credit monitor your clients after a breach.
Who Needs Cyber Insurance?Capitol Risk Solutions separates cyber liability in two types. The first is what we usually see in the news: A retail establishment or a medical provider is breached over customer financial records. These types of claims also have credit monitoring after the fact. The second type of loss (and this is growing) is the breach of a professional organization such as a law firm, consulting firm or accounting firm. These types of losses involve the theft of corporate secrets. In many ways, it is more difficult to value the potential liability for these types of claims as no one really knows the financial impact to the customer/client.
Here are some key factors to consider:
- According to a recent survey, nearly seven billion records were breached in 2017. This is up 45% over 2016…..which was the previous record! There is no stopping the increase of cyber breaches.
- The average cost for cyber liability is $141 per record….per record breached. How many records do you have?
- The average time it takes to detect a data breach is 191 days. Often times the breach is discovered by an outside party.