For many years, it’s been widely known and accepted that companies should be accountable for the private records they handle or control.
One law that raised awareness of this issue was the Health Insurance Portability and Accountability Act (HIPAA) of 1996. In 2003, a privacy rule went into effect for the private healthcare information protected under HIPAA. Since then, 46 out of 50 states have amended their state laws or codes to also address how companies and state agencies must respond to leaked personally identifiable information (PII).
Insurance that protects you in case of cyber attack may seem like something only large corporations would need or be able to afford. But believe it or not, cyber liability insurance makes a lot of sense for small companies as well.
1. It’s more affordable than you think.
Policy premiums can be as low as $2,000 a year. You can get coverage as high as $30 million and deductibles as low as $10,000, depending on your needs and how much you’re willing to pay.
2. It can cover more than you think.
Many policies offer “first party” coverage – that is, they’ll pay for things like business interruption, the cost of notifying customers of a breach, and even the expense of hiring a public relations firm to repair any damage done to your image as a result of a cyber attack.
3. You probably don’t have a risk management team.
Big corporations have entire departments devoted to analyzing the risks the company could face and helping set policies and procedures to protect against them. Many smaller companies don’t – but a good insurance broker can perform a similar function.
4. Even if you don’t host your data yourself, you’re still responsible for it.
Is your website and/or any of your data hosted or stored in the cloud? Take a good look at your contracts: You’re still legally responsible, which is a significant risk.
5. Your general policy won’t cover you.
Typically, a general liability policy specifically excludes losses incurred because of the Internet. A good cyber liability policy will pick up where your general policy leaves off.
Contact INSPRO today for assistance in selecting the best policy for your business.