What is Cyber Insurance?

    Our news has been flooded with stories of cyber attacks.  Yahoo was breached in 2013, and every single account -- name, email, and password -- was stolen.  In one instant, 3 billion users had their information captured. Additionally, companies like Under Armour, Ebay, Target, LinkedIn, JP Morgan Chase, Anthem, Equifax, Scottrade, Uber, and many others have had millions and millions of user information stolen.  Home Depot had 50 million credit cards stolen; the IRS had 700,000 social security numbers taken. And the problem is not limited to large companies. There are about 28 million small businesses in America. A report in 2016 revealed that half of these businesses experienced data breaches in that same year.  Let me repeat that: 50% of small businesses in America were breached in a single year.

    Cyber insurance was created to protect businesses from the liability of data breaches and cyber crimes.  If you were to experience a breach, you could risk:

  • Lawsuits from customers
  • Fines from the government
  • Fractured reputation
  • Time and money in order to resolve problems
  • Stress

    With 50% of small businesses being breached in a year, getting cyber insurance is a wise and reasonable thing to do for any business.  Consider how broad the threat of hacking may be:

  • Businesses store information about their clients.  This information may include name, email, DOB, address, and payment information (credit card and/or bank account).  Whether this information is stored in a system online (like QuickBooks) or on a computer, it can be stolen.
  • Businesses have employees and need to keep records of their personal information (social security, DOB, etc).  This can be easily captured by a hacker and used for identity theft.
  • Businesses use systems for storing and tracking data for financial, customer, operational, or marketing purposes.  A criminal could gain control of your account, change your password, or even delete data entirely.
  • Businesses require computers -- and some bad eggs hijack servers, files, or other essential documents, and require a ransom to get them back.
  • Businesses have websites which hackers are able to crash by mimicking a ton of traffic.  They can also take over a site and steal information inputted by users.

    Whether for employees or clients, chances are that your business has gathered a lot of personal information.  It’s important to protect this information with cyber insurance in case it is ever stolen. Instead of asking, “Should I have cyber insurance?” you should really be asking, “Do I have any personal information of clients and/or employees that I wouldn’t want to be stolen?” And if the answer is yes, take the necessary steps to protect yourself today!