By: Michelle Roark
Did you know that a cyber attack affects 556 million victims a year? That’s 18 victims per second and 1.5 million victims per day. 1
Your clients’ information can be stolen in minutes when a hacker gains access to your network or a network that supports your business. Although large corporate breeches make the news, 62% of cyber attack victims are small to mid-sized businesses.2 Often, despite company IT precautions, a hacker gains access to your information when employees unknowingly open phishing emails, use common passwords or mishandle client information (ex: not shredding documents/leaving information on their desks, etc).
The costs associated with a data breach are significant. The 2016 Ponemon Cost of Data Breach Study found the average total cost of a breach to be $4 million and the average cost per affected record to be $158.
A standard Business Owners or General Liability policy does not include coverage for a data breach or cyber attack. The best way to protect your clients and your business is by having a Cyber Liability policy. Cyber Liability coverage is a custom policy that includes first and third party coverages and is customized for each business based on their operations and exposures. First-party coverage applies to the loss of or damage to your own data that is caused during the data breach. The most common first party coverages are notification costs; the expenses to notify your clients that you have experienced a breach. Third-party coverage involves your liability to your clients or the government and regulatory entities. The most common third party coverages are the damages paid to a third party because of a breach.
First Party Loss Examples:
- Computer forensic investigation
- Crisis management
- Breach notification
- Credit monitoring
- Identity theft remediation
- Public relations
- Data ransom and cyber extortion
- Business interruption and income
Third Part Loss Examples:
- Legal fees to defend you in a law suit
- Regulatory fines and penalties
- Unauthorized access
- Intellectual property loss
The inevitability is that it’s not if you will have a data breach, but when. To protect your clients and the reputation of your business, call me at 410-377-2111 for a Cyber Liability risk assessment.