What Is Cyber Insurance? Everything You Need To Know About It, What It Covers, And How It Works

Cyber insurance should not be considered a substitute for effective and robust cyber risk management. All companies are required to purchase cyber insurance, but should only consider doing so to mitigate the damage caused by a potential cyber attack. Your cyber insurance policy should complement the security processes and technologies you implement as part of your risk management plan. Traditional insurance policies often exclude cyber risks, which has led to the growth of cybersecurity insurance as a standalone coverage type. Potential customers include any business that accepts digital payments or stores personal information about its customers, including medical and financial data. Like other insurance policies, cyber insurance often includes a war exclusion clause that specifically excludes losses from acts of war.

The amount of liability coverage in a cybersecurity and data privacy insurance policy depends on the needs of the business. Whether your customers are individuals or other businesses, you can be held liable for damages if their data is compromised by a cyberattack on your business. Cybersecurity liability insurance protects a business if a third party sues the policyholder for damages due to a cyber incident. A cyber insurance policy protects businesses from the costs of Internet-based threats that affect IT infrastructure, information management and information policy, which are often not covered by traditional commercial liability policies and insurance products. Liability insurance covers claims made against your company by injured parties.

Embroker can help you obtain cyber liability insurance that covers both first- and third-party financial losses resulting from data breaches and other cyber crimes that can put sensitive company and customer data at risk. Cyber insurance policies are sold by many of the same providers that offer related business insurance, such as E&O insurance, public liability insurance, WISP and commercial property insurance. Although some cyber insurance policies contain specific provisions for E&O, most providers sell them as separate and distinct policies. E&O insurance does not cover the loss of third-party data, such as customer credit card numbers; customers who need such protection can purchase cyber insurance that covers that data.

Fortinet provides industry-leading technologies, such as enterprise ransomware and phishing solutions, that help organizations strengthen their cybersecurity measures and demonstrate that they have the processes in place to qualify for cyber insurance. Fortinet’s technology protects organizations from advanced cyber threats such as malware and distributed denial of service attacks, and prevents cyber criminals from gaining unauthorized access to their networks and systems. Companies can also be held liable for damages caused by the loss or theft of third-party data. A cyber insurance policy can protect a business from cyber events, including cyber terrorist attacks, and help remediate security incidents. Cyber liability insurance protects small businesses from the high costs of a data breach or malware attack. It covers costs such as customer notification, credit monitoring, legal fees and fines.

Cyber risk insurance protects an organization from security and privacy incidents by covering the cost of recovery from a data breach, virus or other form of malicious cybersecurity activity. In addition to helping your organization recover, cyber insurance is also important to protect your organization from the legal liability of those affected by the security breach. This could come from customers, employees, partners, third parties and anyone connected to your network who has been affected and whose data may have been exposed. All organizations, from global corporations to family-owned businesses that use technology to conduct business, face cyber risks.