Cyber Liability Insurance | Cyber Security for Business | BizCover (2024)

FAQs

Is cyber insurance enough? ›

“Cyber insurance will not instantly solve all of your cyber security issues, and it will not prevent a cyber breach/attack. Just as homeowners with household insurance are expected to have adequate security measures in place, organisations must continue to put measures in place to protect what they care about.”

A data breach costs a business an average of $150 per lost or stolen record of customer PII. Most small businesses purchase a cyber liability insurance policy with a $1 million per-occurrence limit, a $1 million aggregate limit, and a $1,000 deductible.

Cyber liability insurance is an insurance policy that provides businesses with a combination of coverage options to help protect the company from data breaches and other cybersecurity issues. It's not a question of if your organization will suffer a breach but when.

It can help recoup costs associated with recovering compromised data Your business may lose access to data following a variety of cyber attacks, including a malware incident or ransomware attack. Data mining and recovery can be expensive and require specialized technical knowledge.

For small businesses, annual cyber insurance premiums can range from $1,000 to $7,500. This range is dependent on several factors, which we discuss below. A recent survey found that the majority of cyber insurance underwriters expect rates to increase slightly in 2024.

Loss of value through intellectual property (IP) theft

Often, they won't recognize IP theft until long after an incident (for example, when a competitor takes a new product to market). Nevertheless, devaluation due to IP theft is a loss most cyber policies don't cover.

Your industry. Certain industries are subject to higher premiums because they are more susceptible to threats. Hospitals, for example, are a major target of ransomware attacks because they store sensitive patient data and will often choose to pay ransoms rather than risk their patients' lives by going offline.

A third (33%) of US small businesses consider cyber risk high or very high, ahead of economic issues and competition. Bearing the risk in mind, more than half (53%) of SMEs have either a standalone cyber insurance policy or have cyber coverage through another policy.

If you own a business that collects or stores sensitive information, such as customer/supplier data or financial information, you may be at risk. Cyber insurance can help protect you from the financial consequences of a breach of these data and a disruption of your business.

Yes. Simply put, cyber liability insurance covers monetary losses from a breach AND provides legal protection. Data breach insurance only protects your financial interest. Let's take a deeper look at each type of coverage to get a clear understanding of the differences between the two.

What is true of cyber liability insurance? ›

Crucially, a cyber liability policy protects your business beyond the basics of a general liability policy, which on its own typically does not protect against the operational, legal, and other costs arising from cyberattacks and data breaches.

Website Media Content

AmTrust's Cyber Liability policy also includes coverage for Website Media Content Liability.

Cyber insurance protects against losses that result from a range of cyber incidents, including social engineering scams and ransomware attacks. But is it worth the investment? It's a resounding 'yes'.

Cyber insurance covers the liability actions that might be brought against you, arising out of a cyber event (third party loss), such as investigation and defence costs, civil damages, compensation payments to affected parties.

The average settled cyber claim (where any type of cost has been incurred, excluding zero value losses) is $4.88m. From this we have seen that: Data breaches are the most frequently reported losses and have the largest total amount of costs associated with them.

Demand, losses, and premiums are all on the rise

The demand for cyber insurance coverage is skyrocketing. At the same time, insurance providers' losses are growing. High demand in combination with high payouts lead to increased premiums. Businesses report premium hikes of 50% and even 100% year over year.

Data breaches in the U.S. cost up to 9.44 USD on average. 34% of organizations in the U.S. have a standalone cybersecurity insurance policy. 43% of SMEs in the U.S. bought cyber insurance for the transfer of risks.