Insuranceciooutlook

The Growing Importance of Cyber Liability Insurance

By Insurance CIO Outlook | Wednesday, February 06, 2019

The majority of enterprises rely on information technology tools for meeting their business objectives and safeguarding their intellectual property. Coincidently, these critical digital assets are being targeted by cybercriminals. In order to adequately protect the organization from the threats that will impinge on its reputation and business, the approach to cybersecurity must be in pace with ongoing developments and updates.

Organizations must, therefore, mold an organizational strategy to include the role and responsibilities for designing policies and procedures, security technology design and implementation approaches from a cyber risk perspective. No business is safe from cybercrime. Having cyber liability insurance apart from organizational strategy can help protect the business from major expenses, business loss and regulatory fines from the occurrence of the data breach.

Why Cyber Liability Insurance Is Important

Cyber liability insurance policies can cover the expense of notifying customers, replace lost income and cover legal defense fees as results of the breach. It is cost-effective to prevent data breach by securing data than to lose data from a breach. Cyber liability insurance covers loss related to hacking than other business policies are reluctant to.

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For example:

• Client names, contact information, employee information, social security numbers, and all other business data that an organization has the utmost importance.

• If the systems fail because of a computer virus, data breach or destructive employee, cyber liability insurance will provide coverage.

• Loss of third-party data

• Business website and employee activity triggering liability on social media like copyright infringement, defamatory statements, and leaked information.

Benefits of Having A Cyber Liability Insurance

As with any insurance policy, the benefit is to mitigate threats and financial loss. But some advantages specific to cyber liability insurance are

• Crisis management
• Compliance and legislation
• Cybersecurity gaps

Good cyber insurance can help ensure maximum protection against cyber threats. Policies of cyber liability insurance depending on the industry, services, types of sensitive data, risks and exposures, and so on.

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