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May 28, 2024
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What Is Cyber Insurance? 

black laptop computer turned on with lights symbolizing benefits gained from cyber insuranceAs your business adopts new technologies into its operations, you must be aware that such advancements can often be a double-edged sword.

The conveniences and capabilities of various programs, applications and online solutions can provide great value, but without adequate planning, they could also present significant risks and exposures.

Cyber insurance can provide crucial coverage for data breaches and other cyber incidents.

How Does it Work?

Like many insurance products, cyber insurance, also known as cyber liability insurance, acts as a loss control instrument. Securing a policy and keeping up with your premiums allows you to enjoy financial security and peace of mind as you retain the means to file a claim for financial assistance in response to covered incidents.

What Does it Cover?

Cyber insurance primarily focuses on limiting the financial consequences of cyber incidents, such as phishing scams and ransomware attacks. Your policy can vary significantly in its capabilities, limitations and details.

As your business researches coverage options and gets quotes from various carriers, consider ensuring that your policy can assist with the following:

  • Notification costs—Your coverage may render financial aid for informing affected parties about the incident, such as clients and customers whose sensitive data may have been breached.
  • Fees for outside help—In the wake of a cyber incident, cyber insurance may pay for you to enlist additional help, such as IT contractors, digital forensics investigators and crisis management teams.
  • Data restoration expenses—Should your data or systems be compromised or corrupted, payouts could help you with recovery or replacement costs.
  • Business interruption losses—Cyber incidents may cause significant delays, as you may need to take your network offline until the issue has been resolved. Fortunately, your coverage may assist with resulting losses, such as reduced income.
  • Cyberextortion payments—Cybercriminals may use ransomware to hold your data hostage or blackmail you. Cyber insurance can provide funds to help meet their demands.
  • Legal costs—After a cyber incident, your company may face lawsuits filed by affected parties. In response, your insurance may help pay for attorney fees, settlements and judgments.

How Much Does it Cost?

Insurance rates vary depending on your business’s needs and circumstances. Carriers may often consider the following criteria:

  • Industry
  • Number of employees
  • Type and amount of data you work with
  • Current cybersecurity measures

Why Is Cyber Insurance Important?

In the digital era, where most companies, regardless of size or sector, use online technology in some way, cyber insurance should be a top priority. These policies can provide critical financial security after a cyber incident. Furthermore, organizations in certain sectors may be required to maintain certain levels of coverage.

How to Get Cyber Insurance Near Me

The dedicated team at Trilogy Insurance Brokers, Inc. is committed to helping your business understand and acquire the right cyber insurance. Contact us today to get started.

 

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.

 

Categories: Blog

Tags: business interruption losses, cyber insurance, cyberextortion, data restoration expenses, notification costs

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