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July 24, 2023
Crume-Evans Insurance

Do Small Businesses Need Cyber Liability Insurance?

Cyber risks have become significant issues for many organizations to address. Increased use of technology in many workplaces has helped to streamline operations and spur innovation, but such advancements may also create new exposures or exacerbate previously existing ones. As your company continues to implement digital solutions and work in cyberspace, you should prioritize expanding loss control measures accordingly, such as with a cyber liability insurance policy.

Why Is Cyber Liability Insurance Important?

As its name suggests, cyber liability insurance may provide critical financial security for your organization following cyber incidents, such as data breaches or cyberattacks. Managing the aftermath of these situations can be difficult, and the resulting financial losses could be immense. Fortunately, by purchasing and maintaining a cyber liability insurance policy, your business may have the resources needed to minimize out-of-pocket losses.

Even for small and midsized businesses, cyber liability insurance should be considered a high priority. In recent years, many cybercriminals have expanded their target selection beyond large companies and corporations. Additionally, smaller organizations may have limited financial flexibility, meaning that paying out of pocket for the costly consequences of even a single cyber incident could have long-lasting ramifications.

What Does Cyber Liability Insurance Cover?

Cyber liability insurance can cast a versatile safety net across many types of financial losses and expenses arising from cyber incidents. Although specific coverage details can vary, your company’s policy may render aid for the following:

  • Incident investigation—Your policy may help pay for digital forensic investigators to look into the cause of a cyber incident.
  • Notification expenses—If a cyber incident exposes other parties’ sensitive information (e.g., a client’s private data) your policy may help pay for the costs of notifying them.
  • Additional assistance—In the aftermath of a cyber incident, your policy may help pay to enlist the assistance of credit and fraud monitoring services, crisis management teams and public relations firms.
  • Business interruption costs—If a cyber incident disrupts or delays your company’s normal operations, your policy may help you recoup lost or reduced income.
  • Extortion payments—If a cybercriminal uses ransomware to hold your company’s systems and confidential data hostage, your policy may help pay for you to meet their demands.
  • Legal expenses—Your policy may help cover losses and costs arising from lawsuits related to cyber incidents, such as attorney fees, settlements and judgments.

Get the Right Coverage

The dedicated agents at Crume-Evans Insurance have the knowledge and experience to help your organization get the right cyber liability coverage. We will work with you to consider your needs and compose an optimal policy. 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: Cyber Liability