Cyber liability insurance is one of the most under-utilized types of insurance around. Critical as it is, it’s still a mostly unknown entity to those who should be employing it, namely online-based business owners. The following is a basic primer that covers what it is and who needs it.

Who should have cyber insurance?

It’s widely held that anyone who does business online should have cyber insurance. Even the smallest of operations are vulnerable. Anyone who maintains a website that processes data from its customers runs a risk every day.

Some assume—wrongly—that they don’t have to be worried about compromised data because they have a third-party vendor that handles credit card information, but that doesn’t make them any less liable for damages in the event of a breach. In fact, you could be legally liable for anything passed along during an Internet connection.

What is covered by cyber liability insurance?

Cyber liability insurance is much like other types of liability insurance. If sales are really down because of an interruption to the business, cyber liability insurance can truly help out. If there is a data breach and notices must be sent to customers, cyber liability insurance covers that cost as well.

It’s a common misconception among those who have liability insurance for a small business that their policy will protect them from virtually everything and anything. But the reality is that it doesn’t shield you from online issues.

In so many ways, the Internet is the modern-day Wild West. New challenges seem to crop up by the hour, and there’s not nearly enough regulation or oversight to guard against even the majority of it. Do you really want to take the chance of leaving yourself exposed in that kind of environment?

Author: Peter Green Insurance LLC: We are an “independent” insurance agency on Orange County CA which means we are not locked in or bound to a specific insurance company allowing us to search many large and specialty insurance carriers on your behalf.

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