
For today’s businesses, the Internet represents a critical piece in operations, from e-commerce to data storage. Find out the reasons why your business needs cyber liability.
For today’s businesses, the Internet represents a critical piece in operations, from e-commerce to data storage. Find out the reasons why your business needs cyber liability.
While reliance on digital devices brings many benefits, it also exposes the business to risks related to cyber ransoms, network damage, theft of personal and corporate information, copyright infringement, etc. These issues don’t just impact an organization’s financial situation but can harm its reputation, brand, and image, as well in the last few years, there is evidence of massive breaches at major brands like Target and eBay. But there are small ones in all sorts of industries including healthcare, retail and even manufacturing with less robust cyber protection. Any company that is customer-facing or heavily reliant on technology is vulnerable.
Major Cyber-attacks have taken place in the year 2021 which has impacted big corporations
With the growing economies and usage of electronic and computer devices, the Cyber-attacks have shown an upward trend in last two decades. According to Identity Theft Resource Center (ITRC) research, the total number of data breaches through September 30, 2021, has already exceeded the total number of events in 2020 by 17%, with 1,291 breaches in 2021 compared to 1,108 breaches in 2020.
Some Large Cyber attacks in past two decades which jolted the big industries and left the users vulnerable.
The ancestry of cyber coverage dates back about 20+ years. Earlier, technology companies bought errors and omissions (E&O) insurance, which over time, was extended to include things like a software product bringing down another company’s network, unauthorized access to a client system, destruction of data, or a virus impacting a customer. Spreading of computer virus was a big concern – you might remember the Love Bug Virus that swept the globe in 2000 in this regard.
Later during this period, the Network security policies expanded into the privacy space by providing clear coverage for breaches of confidential information. This got the attention of retailers and other companies holding considerable consumer data. The evolution has been important to where we are now because those exposures are prevailing today.
Cyber coverage is generally a combination of Three components A) Event Management, b) Data protection Obligation and c) Liability
- Covers the fees and expenses of Response Advisor in providing Legal Services.
- Covers IT, Specialist, in providing the First Response IT Services
- Covers Crisis Consultant, if its appointment is considered necessary by the Response Advisor or the Insurer
Covers reasonable and necessary fees and expenses of the Response Advisor in providing the Legal Services in connection with a Breach of Personal Information, Security Failure or System Failure.
Covers reasonable and necessary fees and expenses of the IT Specialist in connection with a
Security Failure or System Failure for the purpose of:
written consent, for credit or identity theft monitoring services to identify possible misuse of any Personal Information as a result of an actual or suspected Breach of Personal Information; and/or the reasonable and necessary premium for any ID Theft Insurance. Such fees, costs and expenses (including premium) will only be paid by the Insurer for Data Subjects
A Cyber Liability policy provides coverage for both first-party costs and third-party liabilities. First-party cyber insurance coverage applies to direct costs for responding to a privacy breach or security failure, and third-party cyber insurance coverage applies when people sue or make claims against the company.
Some common first-party costs when a security failure or data breach occurs include:
Cyber Attack Impact Factors: A list of hidden losses under cyber liability
There are a few key items that are currently not covered under a Cyber Liability policy:
Data breaches and network security failures happen. According to a statistical report more than 91 million security events per year. Cyber risk is an emerging risk in the world. The ability to quantify cyber risk and make informed decisions about cyber risk appetite will often be the difference between success and failure for modern enterprises. Those who do so effectively will be better positioned to enable continued growth, those who do not will expose their organization to risks with potential implications. A robust cyber insurance policy can help businesses weather the storm more effectively when a data breach or network security failure occurs.At Gargash Insurance Services, we know how important it is to protect your company’s and your clients’ sensitive digital information. That’s why we offer insurance solutions for network security, privacy and cyber liability insurance — for both first and third parties — covering risks associated with internet business, networks and informational resources.
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