Cybersecurity Insurance: Another Tool in Your Protection Toolbox

Back in our February 2018 newsletter, we focused on cybersecurity, “The Top 5 Tricks, Sneaky Schemes and Gimmick Cybercriminals Use to Hack Your Computer Network”.  As we stated, knowing the strategies hackers deploy is half the battle because their techniques are constantly changing; it’s impossible to keep up by your-self. Which is why it’s so important to utilize only the most up-to-date security solutions when protecting your business.

But if despite all your best efforts, you still experience an attack, you can usually obtain insurance to help mitigate the costs and lost profits that may result. We don’t sell insurance, but here is what we are seeing in typical cyber-security insurance policies:

•  Business Interruption Protection. The smaller your business, the more income you may lose if you’re temporarily sidelined. Cyber insurance can offset losses.
• Help Mitigating Risk. Small businesses don’t have time to manage web security. A cyber policy may provide periodic reviews and other assistance.
• Reimbursement for Fees and Penalties. Insurance benefits could reimburse you for additional staff required to recover from a cyber-attack, or other related costs.
• Legal Aid. Hopefully a data breach won’t result in legal action, but if it did, your plan could help find an attorney, as well as cover legal fees and judgements against you.

But like any insurance, coverage is going to depend on a lot of factors, and every insurer is going to ask questions about your current technology practices to sure your security procedures are as strong as possible in order to determine costs and eligible coverage. The questions on those applications can be difficult to answer, and of course are oriented to make sure you don’t need to actually claim coverage. They typically will want to confirm that you have firewall technology, keep your operating systems up to date with patching, update your anti-virus software and have good backups, etc.

When we’re helping our clients fill out these applications it provides a good opportunity to have a discussion about ways to improve security. While most of what they are asking for we have already set up, some of those methods, like implementing complex, frequently changed passwords and limiting the number of employees who can access secure data, have to be balanced against the ease of using your systems and the ease of getting remote access for those who need it.

Contact your business liability insurance vendor to see if cyber security insurance is worth it for your business, and feel free to contact us to assist with filling out the applications.