Cyber Liability Insurance 101

Cyber Liability Insurance 101

As technology becomes increasingly important for successful business operations, the value of a strong Cyber Liability Insurance policy will only continue to grow. The continued rise in the amount of information stored and transferred electronically has resulted in a remarkable increase in the potential exposures facing businesses.

Why Cyber Liability Insurance?

A traditional business liability policy is extremely unlikely to protect against most cyber exposures and typically explicitly excludes such coverage. However, exposures are vast, ranging from the content you put on your website to stored customer data.

Possible exposures covered by a typical Cyber Liability Insurance policy may include:

  • Cyber Liability Insurance For Data Breaches – Even companies that don’t transmit personal data over the Internet, but still store it in electronic form, could be susceptible to breaches by unauthorized employees and hardware theft.
  • Cyber Liability Insurance For Intellectual Property Rights – Your company’s online presence, opens you up to some of the same exposures faced by publishers. This can include libel, copyright or trademark infringement and defamation, among other things.
  • Cyber Liability Insurance For Damages To a Third-party System – If an email sent from your server has a virus that crashes the system of a customer, or the software your company distributes fails, resulting in a loss for a third party, you could be held liable for the damages.
  • Cyber Liability Insurance For System Failure – While the physical damages to your system hardware would be covered under your existing business liability policy, data or code loss due to the incident would generally not be covered.
  • Cyber Liability Insurance For Cyber Extortion – Hackers may hijack websites, networks and stored data, denying access to you or your customers. They often demand money to restore your systems to working order.
  • Cyber Liability Insurance For Business Interruption – A disaster can cripples your ability to transmit data could cause you, or a third party that depends on your services, to lose potential revenue.

Cyber Liability Insurance is specifically designed to address the risks that come with running a business in the 21st century–risks that other types of business liability coverage simply won’t cover.

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