FAQ – Cyber Insurance
Cyber insurance has emerged as essential to many businesses’ loss control measures and risk management practices.
These policies, also known as cyber liability insurance and cybersecurity insurance, can play a critical role in helping your organization weather the fiscal ramifications of data breaches and other cyber incidents. However, coverage can also be nuanced and complicated.
Consider the following frequently asked questions regarding cyber insurance.
Question: What Incidents Does Cyber Insurance Cover?
Answer: There are many types of cyber incidents your business may need to account for. Fortunately, an adequate insurance policy can provide versatile and robust financial protection, including in response to the following:
- Phishing
- Social engineering
- Malware infections
- Ransomware attacks
- Distributed denial-of-service attacks
Question: How Can Cyber Insurance Help Following These Incidents?
Answer: Like many insurance products, this type of insurance policy retains your business the right to file a claim for financial assistance following covered incidents. Although exact details may vary, you may be able to receive a payout to assist with the following expenses and losses:
- Incident response costs, such as if you need to notify parties whose data was corrupted or want to hire digital forensics investigators to uncover the cause of the incident
- Business interruption losses, such as if your operations were disrupted and you lost projected revenue due to the breach
- Noncompliance fines, such as those imposed by regulatory agencies
- Legal expenses, such as for attorney fees, settlements and judgments arising from lawsuits filed by affected parties
- Reputational rehabilitation expenses, such as hiring a public relations firm following a data breach
Question: Who Needs Cyber Insurance?
Answer: This type of insurance should be considered essential for most businesses in the modern era. Even organizations in sectors that may have traditionally relied minimally on digital solutions likely now utilize specific resources, such as email and video conferencing software.
Additionally, cybercriminals have expanded their target selection in recent years, with small- and medium-sized companies being attacked more often than they may have previously been.
Question: How Much Does Cyber Insurance Cost?
Answer: Insurance rates can vary significantly based on various criteria. Quoting processes may vary among carriers, but the following factors may often be considered:
- Industry
- Size of workforce
- Number of clients
- Amount of data stored or worked with
- Type of data involved in operations (e.g., social security numbers, banking information and health records)
We’re Here to Help
Contact Silicon Valley Risk & Insurance Services today to learn more about cyber insurance or get a personalized quote.
This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.