The alarming statistics are all around us - small businesses top the list of preferred targets for cybercriminals, primarily due to their relative vulnerability. A recent article from Security Magazine revealed that an astounding 63% of small businesses have fallen prey to cyber-attacks, with 58% suffering actual breaches. What's more alarming is that many of these businesses still underestimate the significant financial damage a cyber-attack can inflict.
This has led to the rapid growth of the cyber liability insurance sector. This type of insurance helps absorb the hefty costs related to a breach, which, depending on your policy, may include:
• Handling legal costs from lawsuits, fines, and penalties from regulatory investigations.
• Negotiating and paying ransomware demands.
• Data restoration and emergency IT expenses to get your network up and running again.
• Alerting customers and monitoring credit and identity theft for clients and employees.
• Managing public relations and call center costs for inbound inquiries.
• Covering the loss of revenue due to halted operations.
• Compensating for errors and omissions in service delivery or negligence in protecting customers' data.
For any business looking to safeguard its hard-earned assets from cyber criminals, cyber liability insurance is indispensable. But it's essential to know that acquiring this coverage entails a strict commitment to implementing robust cyber protection measures. Understandably, insurance providers want to minimize potential payouts by ensuring that their policyholders are adequately protected against cyber threats.
The problem arises when business owners assert that they have implemented such protective measures - such as two-factor authentication (2FA), strong password policies, employee awareness training, and regular data backups - but fail to follow through, often assuming that their IT services provider is taking care of it. This can be a costly misconception.
It's quite easy for non-experts to make inaccurate statements in their insurance application, which could lead to a denial of coverage when a cyber-attack does occur. Therefore, if you have cyber liability insurance, it's highly recommended to revisit your application with your IT team to ensure full compliance with what you've declared on your insurance application.
What's vital here is a collaborative effort with your IT service provider to adhere to the security protocols you agreed to when applying for the policy. If a breach occurs, the insurance provider will want evidence of the preventative measures in place to combat cyber threats. Any failure in this regard may result in your claim being denied.
If this is a concern for you - whether you're questioning your need for coverage, wondering if your coverage is sufficient, or anxious about ensuring compliance to avoid a claim denial - ask us, we're more than happy to discuss this with you. We can be reached at 905-542-9759 or request at call back here: https://www.cdntechnologies.com/