Does Your Business Need Cyber Liability Insurance?
You hear about large companies — like Target, Home Depot and Sony — getting hacked, leading to hundreds of thousands of dollars (or even more!) in damages. But these news stories overshadow cases of cybercrime when it comes to smaller businesses. In fact, small businesses face a greater risk of being hacked.
Luckily, your business can get the protection it needs with cyber liability insurance, which is designed to protect assets in the event of a cyber-attack. But why exactly would your business need this coverage? Just one cyber-attack could lead to expenses related to:
- Damage Control: Hackers may gain control of sensitive business files, which they can use to drain money, leak secret plans, access customer data and more. You may be responsible for notifying customers, opening an investigation and offering free credit monitoring services at the least; at the most, you may also have to hire a PR firm to reshape your business’ marred reputation.
- Business Interruption: While you’re taking care of damage control, you may have to close business doors for weeks or even months, causing revenue losses. Once doors re-open, you may be faced with a decline in sales because of your business’ reputation damage.
- Security Updates: After a cyber-attack, it’s in your business’ best interest to make security updates to prevent a future hack. This may require new infrastructure, software and even personnel, along with training your current staff on new procedures.
All of these expenses can eat away at your business’ bank account. But with cyber liability insurance at your side, your losses are likely to be considerably less. That is to say that while this coverage cannot prevent an attack, it can help take care of the expenses after one occurs. This financial assistance can be the difference between a bumpy year and permanently closing down.