There are many valuable aspects about the world of technology that we live in today. Quick and enhanced communication. Widened entertainment. Access to information at the tip of our fingers.
However, with the benefits of technology come some unfortunate aspects as well. It is because of the wide scope of technological knowledge available that Cyber Liability exists.
Cyber Liability is a specific type of insurance designed to cover a variety of both liability and property losses that may result when a business engages in various electronic activities. This includes things such as selling products on the Internet or collecting data within an internal electronic network, which applies to nearly every business with customer, client, patient, and/or on their computer system).
What Does a Cyber Liability Policy Cover?
Cyber and privacy policies cover a company’s liability for a data breach, in which customers’ personal information (i.e. social security number, credit card information) is exposed or stolen by a hacker. Hackers do this by obtaining access to the firm’s electronic network.
The policies differ greatly from carrier to carrier, but may cover a variety of expenses associated with data breaches, including: notification costs, credit monitoring, costs to defend claims by state regulators, fines and penalties, and loss resulting from identity theft.
In addition, the policies cover liability arising from website media content, as well as property exposures from:
- business interruption
- data loss/destruction
- computer fraud
- funds transfer loss
- cyber extortion
Cyber Liability vs. Tech E&O
Cyber and privacy insurance is often confused with technology errors and omissions (tech E&O) insurance.
Tech E&O coverage is intended to protect providers of technology products and services, such as computer software and hardware manufacturers, website designers, and firms that store corporate data on an off-site basis. Nevertheless, tech E&O insurance policies do contain a number of the same insuring agreements as cyber and privacy policies.
We hope that this information was helpful in deciding if you’re in need of a Cyber Liability policy. It is important to be aware of the dangers of hackers and how a data breach could affect your company should it happen to you.