What is Cyber Liability Insurance?
Do you know what cyber security risk is? It’s quite a new concept for business owners to get their heads around and it’s often overlooked by those who do not understand it fully. However, cyber-crime is a huge threat to most companies and it’s important that you protect yourself properly. One of the best ways to do this is to invest in a professional cyber liability insurance policy.
Our team of experts, here at Rigby Financial, demonstrate excellent knowledge in this area. Here they answer some of the most frequently asked questions about cyber liability insurance, giving you a good idea about what it is and how to successfully protect your business from cyber threat.
1. Who is affected by cyber-crime?
Most businesses, no matter how big or small they are, now rely heavily on the digital world, the internet and computer software – and this leaves them open to the possibility of cyber-attack.
Data can be hacked. Online security can be breached. Confidential information can be illegally accessed or stolen by a computer virus. In recent years, there have been many high-profile cases of data hacking – including firms such as Uber, Pizza Hut, Yahoo and Deloitte. Anybody who has a digital footprint can be affected, which is why it is vital to invest in cyber liability insurance.
2. What is cyber-crime?
Cyber-crime is a phenomenon that arose as technology and the capabilities of the internet and email progressed. It is a general term used for lots of different types of online crime; however, when it comes to the world of business, it usually means that your company’s online security has been breached and some sort of information has been stolen. This could include:
- Your customer database
- Confidential customer details like payment information and bank details
- Valuable employment data such as NI numbers
- Intellectual Property
- Digital and/or Cloud stored data
- Social Media accounts passwords and logins
Most cyber liability insurance policies will offer cover for breaches to all of the above.
What is Cyber Liability Insurance?
Cyber-crime is amongst the quickest growing category of organised crime in the world. According to last year’s Cyber Security Breaches Survey, 37% of all UK businesses suffered at least one cyber security breach or attack in 2017.
Cyber liability insurance is used to guard your business against these internet threats – helping you to recover any costs suffered if the worst case was to happen. When selecting a policy, it’s usually a good idea to seek the help of a professional insurance broker – such as Rigby Financial. Our team can offer advice and guidance and they will help to find a policy that is perfect for your business’s needs.
What is covered by a cyber liability policy?
A cyber liability insurance policy may seem an alien concept to business owners who have run their organisations for years without a hitch. But, unfortunately, with new technology comes new risk – and with new risk comes new forms of insurance to help you to manage the potential fallout.
Cyber liability insurance can cover you against a variety of threats, including:
- Costs accrued whilst repairing any damage that your website or systems may have incurred, as a result of any viruses, and rebuilding anything that has been destroyed by them
- Costs incurred in the pursuit of the safe return of any lost or stolen data
- Any cost incurred as a result of ID theft and the illegal use of your online identity
- Any costs involved in restoration after hacking
Any compensation you may have to pay should you accidentally find yourself invading IP (intellectual property)
Do I need cyber liability insurance?
Cyber liability insurance is often overlooked by business owners, either because they think it isn’t relevant to their line of work or they believe their company is too small for it to be relevant. However, if your business is reliant on computer systems or if you handle sensitive customer information (e.g. names, addresses, banking information), a cyber liability policy is essential.
A security breach could potentially compromise such information and, as part of the 2018 General Data Protection Regulation (GDPR), a business can be fined in such circumstances – for up to €20 million or 4% of its turnover (dependent on which is higher). You need to protect yourself against such financial losses with cyber liability insurance. The policy can be tailored to your business, whether it is big or small, and it is there to protect your assets should the worst happen.
How can companies better manage cyber risk?
There are many simple steps that your business can take to help manage cyber risk. It’s important to note, human error is behind many cases of a cyber security breach – where, in effect, the door has been left open for online intruders by accident. Therefore, simply training your staff and making sure they are up-to-speed on the latest online threats can make a huge difference.
You should also conduct a thorough risk assessment of any information stored online or within the company’s services – just as you would with a physical aspect of your organisation. Ask yourself: what would be the worst case scenario should these systems be hacked? Then try to come up with a plan that prepares you for this scenario and protects your business’s prospects should it happen.
Use secure passwords and logins on all hard drives and install passcode doors throughout the building – restricting entry and reducing the likelihood of device theft. It’s also a good idea to invest in high-quality cyber security and antivirus software. Believe us – the amount you’ll spend on this will pale in comparison to the money you’ll need to pay in compensation, should the security of your data be compromised and the private information of your business and its clients be leaked.
Even if you are taking these steps to reduce the risk of an online security breach, it’s still important to invest in cyber security insurance. If the worst were to happen, you will be able to recover any financial repercussions that you suffer and any loss of data or sensitive information.
What are some of the main cyber risks for businesses?
There are a number of major online or electronic risks that may result in your company’s internet or electronic security being breached. These include:
Human error – loss, theft or the accidental allowance of unauthorised access to a device, used for professional purposes, that could expose private or protected information
Cyber criminals – purposefully attacking or accessing your online presence or any data you may have stored, either to smear your company’s image or to steal information. The criminals may target you or your employees with sophisticated emails (or other methods of contact) designed to draw personal, professional or financial information – which they can they use for their own benefit.
Data ‘hostage’ – this is where an individual or illegal enterprise takes data or an element of your electronic arsenal “hostage” and threatens to only restore things to the way they were, once they have received a certain amount of money.
8. What to look for as a cyber insurance buyer
It’s always a good idea to search for a cyber insurance package that covers your company’s specific needs, without having to spend too much on unnecessary extras. You need to make sure that your company’s entire network is covered, not just individual machines or devices. You should also consider whether third-party insurance is required. This not only covers you, your business and its employees, but also any customers whose data you may have stored on your servers.
If you’re looking to invest in cyber liability insurance, the best option is to seek the advice and guidance of an insurance broker, such as Rigby Financial. It’s important to discuss your particular concerns in-depth. Bring along the aforementioned risk assessment for reference and be sure to mention any risks that are unique to your business. Any information will help them to identify essential aspects of your policy, whilst also eliminating any aspects that are unnecessary.
9. How much does cyber liability insurance cost?
The answer to this question primarily depends on the type of policy you opt for and the extent and variety of its cover. A core policy will carry a baseline price tag, and any add-ons will cost extra. Here at Rigby Financial, we can tailor your cyber liability insurance policy to meet your exact needs. To find out how much your coverage will cost, simply request a quote via our online form.
10. What is first-party cyber coverage?
First party response cover, for cyber liability insurance, helps protect businesses in the event of a data breach or anything that compromises customer’s personal data. It covers the cost of a variety of processes that must be implemented, in order to fully protect your organisation.
Breach announcements - essential in the event of a security breach, as you must inform any customers that have been affected, whilst also relaying the steps they should take as a result.
Credit monitoring – extremely important post-breach. Cybercriminals may have gained access to your business finances and confidential documents and it’s important to monitor these carefully in order to prevent fraud.
Public relations – all organisations understand that a cyber breach is a PR nightmare, which is why you must implement advertising in order to maintain your brand’s reputation.
11. What is third-party cyber coverage?
Depending on the nature of your company and its clients, third party cyber insurance is likely to be vital. Over the last few years, there have been numerous high-profile cases of data leaks – including banks and high-end websites – where customer information has been hacked into for the purposes of identity theft, fraud, or merely to reveal the impressive capabilities of the hacker in question.
This is where third-party coverage comes into play. Not only does it help to keep the data of those who access your firm’s website (or utilise its services) safe, but it will also compensate them if they fall prey to cyber-crimes – which are becoming more and more sophisticated with every day.
How can a cyber data breach happen?
There are many ways in which a data breach can occur. Hackers are getting smarter all the time. With software such as penetration testing tools – originally designed to locate weaknesses in a business’ system – now available for anyone to download, the question is usually “when will a data breach occur” rather than “will one happen at all?”.
The above is just one way in which a cyber-criminal may access your company’s vital information. If your employees are able to access data or accounts from remote locations, there’s always the risk of them using insecure Wi-Fi connections or misplacing their devices. This is another way in which your company’s security may be compromised. Many cyber criminals strike from within the company itself. There’s no way of ensuring that one of your own employees will not leak your firm’s information, but there are ways to protect yourself and your organisation should this take place.
13. What if we store client data in the cloud?
There are a great many advantages to storing data in the cloud. Important information can be shared with all employees who need to see and approve it, without the need for email attachments, and changes can be made to documents simultaneously across devices. However, as shown by previous high profile data breaches, the cloud is rarely the safest place to store information.
Client data should be held in a secure server that is only accessible if an individual is able to satisfy data protection security requirements. If you contact a call centre, for example, you’ll normally need to answer a number of questions regarding your personal information (e.g. date of birth, postcode, mother’s maiden name, chosen password etc.) to allow you to access this private data. This approach is much more secure than relying on the cloud. Your insurance premiums will be much more affordable if your clients’ data can be shown to be secure in this way too.
14. Where can I go to buy reliable cyber liability insurance?
When searching for cyber liability insurance, it’s always worth conducting an in-depth search into the market. Most insurance companies now offer some sort of cyber liability coverage. However, if you’re new to cyber-crime security and you’re struggling to find the right policy for you, it can often help to seek the advice of a professional insurance broker. Here at Rigby Financial, we will work closely with you to discuss your business’s requirements and will identify the perfect policy – that covers every aspect of your business’s online presence and activity.
Contact Rigby Financial today
If you would like to find out more about cyber-crime and how to protect your company, you can find further information in our blog ’10 ways to protect your company again cyber-crime’. Once you’re ready to discuss cyber liability insurance with one of our experts, please feel free to get in touch.
We demonstrate strong knowledge and experience in this area and can help to find the ideal cyber liability insurance policy for you and your needs. So why not call us today on 01744 886077 or send them a message via our online contact form. Our offices are open from 9 am until 5.15pm from Monday to Friday and we will respond to your enquiry as soon as possible.