Cyber Security Insurance is a relatively new insurance concept. It is also known as Cyber Liability Insurance Coverage (CLIC), Data Breach Insurance or Privacy Insurance. Here is how to find cyber insurance in today’s marketplace.
Cyber Security Insurance: The Basics
Cyber Insurance policies assist businesses by reducing their exposure to cyber risk. This is done by financially compensating the insured during their recovery efforts after a security infringement.
Vulnerable organizations include:
- Companies that accept credit cards
- HIPAA Compliant Companies
- Financial Planners, and
- Title Companies, among others
The reality is, experts have pretty much concluded that nearly every business enterprise is vulnerable to a Cyber Breach.
Tailoring Cyber Security Insurance Policies to Meet Your Business’ Needs
Cyber Security Insurance is customizable. Available coverage choices include reimbursement for costs associated with:
- Hiring a forensic analyst to decipher the breach’s origin
- Hiring a public relations firm to help overturn the public’s perception of the company after the event
- Potential cyber extortion, among others
Issues to Consider When Selecting Cyber Security Insurance
Package Policy or Standalone Policy?
A stand-alone policy can be tailored to cover certain risks. and costs. Most Cyber Security Insurance policies written in the United States are standalone policies.
Package policies are more like “umbrella” policies. This type of Cyber Security Insurance typically has lower premiums. Other insurance carriers offer ‘data breach’ riders as an add-on to an existing policy.
Determine Exact Coverage
This is the time to compare what the cyber policy covers with the areas your business requires insurance for.
Coverage areas to consider include Network Security, Privacy Liability Policies, and Media liability policies.
1st Party or 3rd Party Coverage
1st party insurance only protects the policyholder. 3rd Party coverage reimburses the insured’s legal defense costs or any damages to 3rd parties.
Find Out what is not covered
Cyber Insurance policy exclusions vary. Certain policies exclude major attacks from ransomware while others exclude legal fees incurred due to the cybersecurity event. Be certain to understand what is, and what is not covered!
Who Provides It?
The current U.S Cyber Security marketplace supports nearly 500 insuring firms. About half the marketplace though is insurance written by three specific Cyber Security Insurance Firms: Chubb, XL Group, and AIG. Other cyber market players include Nationwide, Berkshire Hathaway and Liberty Mutual.
Take note, though, it is prudent to review and research several different policies written by major industry players.
Cyber Security Insurance is fast becoming an integral part of the business security policies across the nation. Niceville Insurance Agency offers Cyber Insurance in Florida. Our professional Cyber Risk Analysts are available to clarify or provide further information regarding this 21st century business hazard.