Since the pandemic, cyber risks have been on a steep upward trend in New York and globally. Cybercrime has cost the global market around 6$ trillion in damages. As more companies leave their digital footprints all over the web, there is an increased need to invest in cybersecurity measures, regardless of what type of business you run. In other words, cybersecurity has moved from being an order winner to an order qualifier.
No business, small or large, is immune to cybercrime. Unfortunately, many business owners belittle cyber threats and sorely lack comprehensive cybersecurity and client privacy tools. To budding entrepreneurs, cybersecurity loses in the trade-off between cost-savings benefits and customer privacy risks. As a result, small businesses rarely invest enough in the protection and resources they need to withstand a cyberattack.
Cybercrime waits for no one.
Your company's ability to ward off a cyber attack or quickly recover from disruptions caused by cybercrime could depend on the reliability and adequacy of your commercial cyber insurance coverage. But let's get back to the basics - the #1 question to ask yourself (or your CEO) is whether your company even has a cyber insurance policy. That may sound like a dumb inquiry, but it's critical to ensuring smooth operations even in the face of a cyber attack.
For instance, what happens if a data breach occurs and you find out that your existing policies are silent on cybercrime? Your business could end up facing reputational damage, liability charges, and costly court proceedings without any financial support from your current insurance coverage. Data breaches alone have cost companies close to $400 million in 2020.
Back to the Basics
For such times as these, cyber insurance can come in quite handy. The cyber insurance market has grown into a billion-dollar industry in the last few years, despite being around since the 1990s. It's also called "cyber risk" or "cyber liability" insurance to showcase its purpose: to protect businesses or individuals against Internet risks, liability, and scams. Here are a few things you should know about cyber insurance:
- There are two levels of cyber liability coverage - first-party and third-party. First-party coverage absorbs the direct losses your organization suffers from data theft or ransom payments. Third-party coverage protects your company from the risk of legal action and claims made against your company by partners, vendors, or customers impacted by a data breach.
- Cyber insurance coverage differs based on your provider but typically includes data breaches and identity theft. Some policies may cover the legal fees and costs of retrieving compromised data, repairing and securing your computer systems, and notifying the public about the breach. With a bit of hunting, you may find policies that cover business interruption, extortion (ransomware attacks), and forensic investigations.
- There are two types of cyber insurance - personal and business. Personal cyber insurance focuses on identity theft and includes income losses, credit history restoration, and legal action against identity thieves. Corporate cyber insurance coverage depends on the size and nature of your company and the number of customers it serves. You'll need to track every point your company collects and stores data, and to whom that data belongs (the company, customers, vendors, etc.).
- You can buy cyber insurance policies online and activate them in seconds. Purchasing cyber insurance is becoming easier by the day to ensure businesses have the defense they need well before a cyber threat occurs.
- There's no one-size-fits-all cyber insurance policy. Instead, you'll have to do your homework and find out what protection your company needs - and which insurance policy meets those needs specifically.
Is Cyber Insurance a Necessity for Your Business?
Cyber liability insurance should be a part of your cybersecurity protocols. Cyber Insurance provides a safety net should a cyberattack, or data breach occur. But make sure you have other cybersecurity mechanisms in place, like two-factor authentication, encryption tools, and password protection.
Carriage Trade Insurance can help you figure out your company's data security needs and match them with an affordable cyber insurance policy. With the vast majority of insurance companies in New York City competing with each other in terms of price and coverage, there's no shortage of options. Contact their seasoned professionals or visit the website to learn more.