Three Types of Cyber Insurance
The world wide web plus globalization along with the global economy afford for many opportunities, including the increase of cybercrime, which is at an all-time high, with 93% of cybercriminals being able to penetrate company networks. According to the Verizon 2022 Data Breach Investigations Report, today 90% of servers are involved in financial breaches. The need for cyber insurance is not something your business can afford to overlook. If your company handles, transmits, or stores sensitive data, you not only need cyber insurance but you need to know about it, what it covers, how it provides coverage, and what sort of payout you can expect if and when a cyber incident occurs. Since small businesses often lack the resources or budgets of big corporations, cyber insurance can provide critical financial protection in the event of a cyberattack, helping them recover quickly.
Although insurers may have their own specific classifications, cyber insurance can be divided into three broad categories, as explained down below.
Types of cyber insurance and what they cover
With more and more businesses storing sensitive data online, the risk of cybertheft is more prominent than ever. As a result, ensuring that your company is adequately insured against this growing threat is critical.
Cybertheft insurance protects businesses from financial losses caused by digital theft. This type of insurance can cover a variety of cybertheft scenarios, including first-party cybertheft, embezzlement scams, payroll redirection, and gift card scams.
Businesses of all sizes can be victims of cybertheft, and no business is too small to need cybertheft insurance. Therefore, even if there is a remote chance that your data or digital assets will be stolen, ensure you have cybertheft insurance for your business.
Cyber Liability Insurance
Cyber liability insurance includes third-party coverage for damages and losses, data breaches, regulatory penalties, credit monitoring and lawsuits.
Cyber liability insurance is a vital tool for small businesses like yours because the financial ramifications of a cybersecurity breach can be more severe than you can handle. This does not mean you should panic right now; it simply means that having cyber liability insurance can help your business recover and move forward even after a breach, without being stunted.
Cyber extortion insurance/ransomware insurance
Cyber extortion insurance protects businesses against ransomware attacks. This type of insurance can help cover the cost of ransom payments, recovery expenses, business interruptions and more. It can also provide access to a team of experts who can help with cyber extortion negotiations and forensics.
Keep in mind that an attack could still succeed even with the right cybersecurity solutions in place to protect your business. That’s why it’s critical to have cyber extortion insurance. It can help you recover from a ransomware attack and reduce the financial impact.
Cyber insurance is a complicated and ever-changing industry. There are many factors that can influence whether or not you qualify for a payout in the event of a cyberattack, and trying to remain compliant with your insurance policy can be difficult. Working with an IT service provider can help you better understand your options and ensure that you have adequate security in place, increasing your chances of receiving complete coverage.
Not sure where to start? Contact us today to schedule a consultation. Our knowledge and experience may be just what you require.