Cyber is considered by many to be the number one risk that businesses currently face. With cyber threats more prominent than ever and the market increasingly more complex, it is important that you have insurance in place to protect you should your business face a cyber threat or attack.
What is cyber insurance?
Cyber insurance is a form of cover designed to protect your business from a range of threats, such as malicious cyber hacks, data breaches and system interruption.
As a business, you are responsible for your own cyber security. However, in the event of a cyber attack, having the right insurance in place will ensure that you’re not alone.
What does cyber insurance cover?
In the event of a security breach, illegal threats or cyber attacks, the majority of cyber insurance policies will cover the first-party and third-party financial and reputational costs should data or electronic systems get damaged, stolen, corrupted or lost.
First-party cover includes:
- Investigating cybercrime
- Recovering data lost in security breaches
- The restoration of computer systems
- Reputation management
- Extortion payments demanded by hackers
- The costs of notifying affected third parties
Third-party coverage includes damages and settlements you are held liable for and the legal costs of defending yourself against claims of a data breach.
What does cyber insurance exclude?
Common exclusions in cyber insurance policies can include:
- Patent, software and copyright infringements
- Fines, penalties and sanctions
- Wars and invasions
- Lack of security
- Injuries and damages
- Loss of portable electronic devices
- Specific network interruptions
The different types of cyber insurance
Although the market around cyber insurance is constantly evolving due to the face-paced nature of the industry, there are five key types of cyber insurance that remain a must.
How you respond to a cyber incident, particularly the first 48 hours, is crucial. It can often be the way that an organisation responds that can have the biggest impact. A cyber insurance policy will cover this and will coordinate the necessary services and resources.
This will include 24/7 support from specialists who can assess and identify the source of any breach, and cover will be provided for the cost of crisis communication and post-breach remediation measures.
Network Security & Privacy Liability
This protects an organisation during network and security collapses, like data breaches, malware infections, business email compromised events and ransomware. It is essential for businesses handling sensitive employee and customer information. This coverage helps to protect organisations in the event of a data breach that would expose private data.
It helps to prevent liabilities as a result of privacy law violations or cyber incidents related to confidential data. These events often include third-party costs due to contractual obligations or regulatory investigations.
Network business interruption coverage helps organisations facing operational cyber risks. This covers loss of income to the business during the period of interruption, occurring from system failures such as security failures and human error. This can be a crucial safety net as you look to recover to ‘normal’ operations.
Cyber Crime is now considered to be more profitable to criminals than drug trafficking. As a consequence, it is much more common and is increasingly important to protect your business against.
This section of cover can include extortion by phishing, ransom attacks, social engineering or losses caused by malware or distributed denial of service (DDOS) attacks. Employees at businesses of all types and sizes do not always know what to look for when it comes to phoney links or malware and inadvertently clicking on them can leave businesses very vulnerable.
Media liability coverage protects businesses from intellectual property infringement. It is usually applied to print and digital advertising, including and organisations posts on social media.
Cyber Insurance with Stanmore
At Stanmore Insurance, we believe that securing the right policy for your business is a detailed process. Due to the complexity and constant changes within the cyber security market, our team of specialists will always advise what we believe is the best option for you at the time.
Get in touch with us to learn more about what level of cyber protection your business needs.