What is Cyber Liability Insurance?

What is Cyber Liability Insurance?

Cyber Liability addresses the first and third party risks associated with e-commerce businesses, the Internet, networks and informational assets. Cyber Liability Insurance offers coverage protection for exposures arising out of Internet communications.

The concept of Cyber Liability takes into account first and third party risks. The risk category includes data storage, business interruptions, fraud and theft, extortion, crisis management, copyrights, privacy issues, virus transmission, or any other serious trouble that may be passed from first to third parties via the Web.

When do I need Cyber Liability Insurance?

Anyone with a Web site now has the legal liabilities of a publisher, and has a legal responsibility to protect customer privacy information.

Creating a Web site is simple. The exposures that come with it are not. Cyber Liability is a constantly evolving risk for every business today. Over the last several years, cyber liability insurance has grown from coverage designed solely for information technology companies to coverage that applies to all industries. Any business that has any form of personal information of their customers or employees (whether in electronic or paper/non-electronic format) has cyber exposure and is at risk.

States are reacting swiftly to data breach issues with sweeping legislation affecting almost all businesses. Recently enacted laws require notification to all customers affected by a breach, whether or not their information has been used maliciously. In most cases, the notification also requires an option of one-year credit monitoring services and a new card or account number for customers. Costs can be as much as $250 for each individual affected by the breach, and the average is around $188 per individual.

Why do I need Cyber Liability Insurance?

Traditional liability products do not address Internet exposures and the risks involved in Internet businesses have blossomed with the Net itself. This is why you need to consider Cyber Liability Insurance when reviewing your business’s insurance needs.

What are the risks in dollars regarding to Cyber Liability?

Below is an example of what your personal data is worth to a hacker:

  • Utility Bill scanned = $10
  • Full identity = $6-$80
  • Gmail user name and password = $80
  • Facebook user name and password = $300
  • Bank account credentials = $15 to $850
  • Credit card with $1000 available = $25
  • Credit card with personal information = $80

The Armstrong Company Insurance Consultants is an independently owned and locally operated insurance broker located in Torrance, CA who will manage all your insurance needs. They offer affordable and reliable insurance choices all across the country. As a result of the changing marketplace and the needs of their customers, they are increasing their focus to include Cyber Liability.

Contact us to learn more about managing your cyber security.