If you handle sensitive or confidential data, you need to protect your business from a potential data breach and that’s where cyber insurance comes in. Sensitive customer data, such as credit card information, health insurance information and/or identity information, are targeted every day so you need systems in place to minimize your liability in the event of a data breach.
It’s as simple as a laptop being stolen from your business, or your database getting hacked. Did you know that since 2008, more than a half a billion data records have been stolen from American businesses, large and small, compromising sensitive customer financial and health information as well as causing a nightmare for the companies affected? In Canada, according to the office of the Privacy Commissioner, there were more than 350 data breaches voluntarily reported in 2010. And in a study prepared by the Ponemon Institute, the average cost of such a breach exceeds $5 million. Few companies are immune.
Simply having the latest and most effective firewalls and data protection programs is not enough. While these programs are certainly a good idea, a resourceful hacker can penetrate virtually any cyber defense, given enough time and effort. Cyber liability insurance helps you to mitigate your financial exposure due to a data breach. Cyber insurance covers damages that are awarded to a third party as a result of a data breach at your company. This could be as a result of:
Such insurance also covers liability due to copyright and trademark claims arising from your company’s social media and blog posts and provide reimbursement should your company’s computer network be held hostage via a cyber attack or virus until an extortion payment is made.
No company, no matter how sophisticated its IT department and cyber defenses, is safe from a cyber attack. Today’s cyber criminals can breach virtually any firewalls and encryption and render them useless. Cyber attacks have the potential to destroy the company you’ve worked so hard to create. That’s why all companies, no matter the size or the industry, should consider adding this insurance to their portfolio.
To learn about the many ways cyber insurance can help to protect your business and limit your liability, call Sean McNamara at Mitchell & Whale Insurance Brokers today at 1-800-731-2228 or email me at email@example.com. I’d be happy to help you with any type of commercial insurance you may need.