Do I need Cybersecurity Insurance for my business?

Do I need Cybersecurity Insurance for my business?

If these are questions you’ve asked yourself, this blog is for you.

What is Cybersecurity Insurance?
What does Cybersecurity Insurance cover?
Does my business need Cybersecurity Insurance?
Am I adequately covered with my existing insurance?

 

All great questions. Let’s break it down. 

Without cybersecurity insurance, every business is at risk. While every organization handles their digital data differently when it comes to cyber risk, cybersecurity insurance is always a good idea. 

We see many companies wait until they experience a serious phishing attempt or full blown cyber attack before they take action and purchase cybersecurity insurance. What’s worse, is that many companies wait until they experience a cyberattack to realize any insurance they do have, does not cover the type of cyberattack they experienced. Unfortunately, this is often the demise of many businesses--they simply can’t absorb the millions of dollars in cost associated with a severe cyberattack.

At PK Tech, we believe in a proactive approach to cybersecurity whenever possible (and we believe you should too). YES, we believe you need cybersecurity insurance. But more than just insurance, it’s vital to understand what your policy includes and covers--many businesses discover after a cyberattack that their insurance doesn’t cover damage from ransomware, viruses, or the large umbrella of malicious digital activity. Insurance without proper coverage, might as well be no coverage at all. Don’t risk losing your business by not fully reading and understanding your policy. 

What is Cybersecurity Insurance? 

  • Cybersecurity insurance protects your business from the damage caused by cyber risks, such as ransomware. Like car insurance protects your car in the event of an accident, cybersecurity insurance protects you in the event of a cyber attack.
  • Your existing regular insurance policy likely does not cover cyber incidents. 
  • Different types of data require different types of cybersecurity insurance. There is not one policy that works for every business.
  • New to cybersecurity insurance? Make sure you work with an agent or ask PK Tech to connect you with the necessary resources to make an educated decision on your cybersecurity insurance purchase.

Types of Cybersecurity Insurance may include: 

  • Legal fees
  • Costs associated with restoring the identities of affected clients within the business
  • Costs associated with recovering data
  • Costs associated with notifying customers of a cyber attack (i.e. breach/data loss)

Quick Facts:

  • Over 60% of small businesses close within 6 months of a cyberattack (source).
  • Ransomware accounts for 40% of cyberattacks (source).
  • Last year, 80% of businesses experienced some type of phishing attack, also known as the number one way hackers get into your business (source).

Common Misconceptions about Cybersecurity Insurance:

  • Most normal insurance policies do not cover cyber attacks. Make sure you purchase specific cybersecurity insurance and understand exactly what it covers.
  • Cybersecurity insurance does not typically cover the following: 
    • Decline in revenue
    • Decline in market share or share price
    • Discredit of company’s reputation (due to cyber attack)
  • Outsourcing your workload to the cloud is NOT a cybersecurity insurance. If you think you’re covered from cyber attacks because you make up sensitive data to the cloud, think again. This is not the case.

Hackers are continuously getting smarter and more innovative in the ways they attempt to breach your business. Don’t fall victim to an attack that could end your business when there is an easy solution: cybersecurity insurance.

If you’re curious about whether your business needs cybersecurity insurance, or whether your existing policy covers what is necessary, contact PK Tech. We are happy to help guide you towards maximum possible cybersecurity for your business.