A Cyber Crime Insurance Policy: Do You Have One?

While the capabilities of the internet and our dependence upon it increases, so does the capabilities of cyber criminals and hackers. Not only do the tools you use provide additional exploitation points, but their technology is in a constant state of evolution. With the possibility of cyber crimes and data breaches to businesses being on the rise, if the unthinkable happens, what will your current business insurance cover? Will it cover anything at all?

Does Your Current Policy Cover Cyber Losses?

Many people think their business and person are covered under existing policies. With an existing business insurance policy for liability, shouldn’t that automatically extend to liabilities from cyber crime? In many cases, it may not. Even if you have an existing policy insuring you from cyber loss, in the constantly changing world of technology, with new services, applications, and devices being added to your business, these policies can quickly become invalid and outdated.

What Traditional Business Insurance Might Cover

Sometimes traditional insurance can cover some portions of losses incurred by cyber crimes and data breaches, though it may take your broker a hard-won fight with insurance companies. With your broker, go over your existing policies for errors and omissions insurance, crime insurance, and general liability insurance, to see if in the event of a cyber loss what could be claimed and what would not be covered. Depending on the results, you may need to change those policies, or invest in a separate policy against cyber crime.

Cloud Hosting Services and BYOD

One of the major reasons that traditional or even cyber-related policies become invalid is the steady march of technology and the attempts of companies to use that technology to the fullest. By hosting their data on third party cloud services, businesses can violate their policies: check the restrictions and plan your hosting accordingly. Also BYOD or “Bring Your Own Device” has become a standard practice at many businesses, hooking up un-vetted and unprotected devices up to the secure data networks of the company, creating more security vulnerabilities.

Responding to a Breach

So the worst happens and you believe your network and the data within have been compromised: what do you do? While you try to contact your clients and your hosting services, and lock your network down, you also need to put in a call to your broker and your insurance agency. The sooner they are in the loop, the sooner they can help analyze the problem and file claims. If you wait too long—just like if you don’t report a car accident—your policy might not cover it.

So, What are You Covered For?

Chances are, regardless if you’re a one-man business or a rapidly expanding corporation, you’ve have networked data on your computer that will hurt your bottom line if compromised or stolen. If this is the first time you’ve asked yourself, “Am I covered if something happens to my data?” you need to sit down with your broker and talk about coverage. If you are looking for brokers who work with you to protect against emerging threats to your business and your data, please contact H & K Insurance today. We’re here to help.