Cyber Liability

What is Cyber Liability Insurance?
Cyber Liability Insurance is the coverage purchased by a business to protect itself from claims and losses that may occur due to a data breach or electronic commerce claims. This coverage is distinct from a standard Commercial General Liability Insurance policy, which specifically excludes cyber related liability events.

What does Cyber Liability Insurance Cover?
While Cyber Liability Insurance provides coverages for various types of losses, the primary focus of this insurance is to protect Florida businesses from liability claims resulting from a data breach which results in personal information being exposed. The policy can provide coverage for a variety of associated expenses, such as legal fees, notification costs, and fines or penalties imposed by regulators.

This type of insurance may also provide coverage for a business or organization to restore their own records, web sites, and other electronic information in the event of it being damaged or corrupted due to activities of a hacker or criminal organization.

What are additional coverage options?
The scope of the Cyber Liability Coverage is quite broad, but the actual coverage provisions tend to vary by insurance carrier and by industry. Some of the more commonly available coverage options are:

  • Breach of privacy coverage – Includes damages resulting from alleged violations of State, Federal, and HIPPA laws.
  • Customer notification expense coverage – Provides for reimbursements for costs to notify customers and clients of any breach. Coverage may include payment for credit monitoring services for affected customers.
  • Cyber Extortion – Provides coverage for credible threats to corrupt or destroy insureds electronic systems.
  • Business Interruption – Provides payment to cover business interruption, and additional expense costs associated with a cyber liability event. Examples of such additional costs are rental of new equipment, additional staff labor time, and third party professional technology services.

Important factors regarding Cyber Liability Insurance
As the electronic world continues to expand, the need for Cyber Liability Insurance is steadily growing. Technology serves each industry in a different fashion, and as such the risks associated with a data breach or other cyber related event differs from business to business. It is important that each business evaluate their particular risks, and to obtain a Cyber Insurance policy reflective of their unique expusures.