“My business isn’t large enough to be a target for cyber crime.” This is often the mindset of many small to mid-sized business owners. It is also the most common misconception for these business owners. In fact, 80% of them opt out of carrying cyber liability insurance. Read the importance of cyber liability insurance from ArboRisk Insurance in New Berlin, Wisconsin here:
For a small business owner, the most common cause of cyber loss is extortion. Extortion occurs when hackers gain access to a business owner’s network and lock up all information until they are paid a ransom. Access can be gained by sending an email with an executable file/image, which an employee clicks on giving the hacker a way into the system. It then operates in the background until it has everything it needs to lock up the system and hold a ransom.
Cyber Crime is constantly changing. Many policies are set up to cover losses we’re familiar with such as stolen credit card data or a system crash, but NOT extortion. The first thing you should do is make sure extortion is covered under your cyber policy (assuming you already have one…). Next, check your limits. An extortion loss is much more than just the ransom you pay the hacker to unlock your information. You then have to inform all clients your database has been breached. The average notification cost can be up to $190 dollars per record including notification by mail, credit monitoring, and legal advice. On top of notification costs you will also have your own defense costs in case any suits are brought against you. Finally, you may be obligated to pay fines from the PCI DSS (payment card industry data security standards). On top of all this, your business has been sidelined losing potential income! Still think $50,000 in data breach is enough coverage?
Do you have questions or concerns regarding cyber liability? Contact ArboRisk Insurance in New Berlin, Wisconsin to discuss what coverages we can provide through our cyber liability program.