As a small business owner, you are probably on the hunt for the right insurance for your business. You don't want to find yourself having to empty your pockets for unexpected expenses that your insurance doesn't cover. So, you take the time needed to review coverage amounts and policies to ensure you get the right insurance.
Have you thought about the big risks many businesses face when it comes to cybercrime? Not having adequate cyber insurance may prove to be a huge threat to your business.
Today we will go over if your commercial business needs cyber loss and cyber insurance, and if so, we will tell you what to look for.
Do You Need Cyber Insurance?
According to a 2018 Small Business Cyber Insurance and Security Spotlight survey, 10 percent of firms suffered from one or more cyber incidents in the year before. In today's very digital world, it doesn’t make good business sense not to have this kind of protection in place. One weak password or a stolen laptop or device can easily lead to a massive data breach.
Costly Data Breaches
Data breaches can be quite costly for a business. In fact, the average consolidated cost of a single data breach in 2016 was $4 million. This is according to a 2017 Cost of Data Breach Study.
Some businesses feel as if their in house security and IT personnel are all the protection they need. However, there may be vulnerabilities they are not aware of, and breaches can still occur. A data breach can happen by accident or by design. You can't always prepare for this or every kind of phishing attack.
Having cyber loss and cyber insurance in place is a way to provide your business with some much-needed protection in case there is any kind of cyber incident. You can have certain coverages that include first-party breach notification coverage, breach mitigation, crisis management, data restoration, and protection again network extortion.
In addition, cyber loss and cyber insurance offer protection and coverage for regulatory fines and penalties, restitution, and grants business access to risk management services in many cases.
Due to the mounting concerns businesses face, cyber insurance is definitely a necessity. Along with the rise in cases, cybersecurity crime costs are also on the rise. In 2019, the cost of a data breach went from $3.86 million to $3.93 million, according to reports put out by the Ponemon Institute and IBM.
Just one data breach can ultimately result in a business having to shut down and declare bankruptcy. Cybersecurity insurance can help mitigate this risk.
When looking for cyber insurance for your business, calculate the size or cost of an event, the costs associated with credit monitoring and crisis management, and the overall costs of legal advice related to an incident. You then have to consider the overall costs involved for hardware replacements and data restoration and the costs involved with the interruption of your business operations.
For more information on cyber loss and cyber insurance coverage for your business, contact the professionals at Panorama today to go over your available options.