What is Cyber Insurance... and does my business need it?

Posted in Commercial Insurance Tips, Cyber Insurance

What is Cyber Insurance... and does my business need it?

Cyber Insurance is increasingly becoming one of the most important coverages for all Canadian businesses – and it offers protection against the effects of cyber-related crime against your organization.

What is Cyber Insurance?

The vast online world sure is an exciting one, but with that comes the many threats of cyber attacks and data breaches. To keep you and your business in the best position possible should one of these attacks affect you, you will want to have Cyber Insurance.

A well-crafted Cyber Insurance policy will helps protect your business on multiple levels: financially, with reputation management, and against business disruption.

Understanding the Different Types of Cyber Insurance Coverage

1. Regulatory Defense

As a business that handles sensitive information you are held responsible for the data you obtain from your clients and customers. To keep this information safe there are a number of regulations set by the government that you must adhere to. Sometimes hackers will get ahead and still manage to breach your security to get this private information. There can be hefty fines for these types of breaches. Regulatory defense helps you cover these types of fines.

2. Cyber Extortion

Should hackers manage to get inside your system and obtain sensitive information, they may then hold it against you. Threatening you with publicly announcing what they have done and then using the information for financial gain. Cyber extortion coverage helps you should this ever unfortunately be the case.

3. E-theft (Phishing)

When you receive an email from an unknown sender and accidentally open it you will probably be okay and safe from intrusion. However, if there is an attachment to the email and you open it you will not be as lucky. If this happens your entire shared network is at risk for being compromised, and client’s information exploited. E-theft coverage is in place to help mitigate the losses caused from this type of attack.

4. Public Relations & Crisis Management

When an attack and data breach occur there is a lot more to it than client data being obtained by people with bad intentions. Your reputation and future are on the line and at risk for failure. To help cover the costs of proper PR, crisis management planning and execution, and media monitoring you will want this type of coverage.

5. Voluntary Notification

If the worst has happened and you are facing a data breach you will have to decide if and how to notify those affected. This type of coverage will help cover those costs to letting your clients know their information may have been taken. Being honest and upfront is a great way to try and gain some trust back and having financial safety for this type of action can be very important.

What Business Owners Can Do to Protect Against Cyber Crime

If you own or manage a business and are worried about the real possibility of a cyber attack, we invite you to talk to one of our commercial insurance brokers to make sure you have the proper coverage for your business.

Does Your Business Policy Include Cyber Insurance?

If you don't know the answer to this question, it's a good idea to speak to your commercial insurance broker sooner than later. As your trusted insurance advisor, your broker will be able to help you understand the impact on your business of the changes to Canada's federal private sector privacy law.

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