Consultations:
Did you know that small businesses are three times more likely to be targeted by cybercriminals than larger companies?
Today, as more small businesses become prime targets of a cyberattack, business owners are looking to their cyber liability insurance policy to help them mitigate risks. However, not every cyber policy is created equal. Here are five coverage considerations you need to know about before purchasing a policy.
1. Retroactive Coverage
Some cyber liability policies only provide coverage for losses that occur after your policy’s inception date. This can be a problem because it could be months or even years before a breach is detected. Retroactive coverage can help protect your business from a loss that occurs before your policy was enacted. If you have the option, try to select a policy that can offer you the earliest retroactive date possible.
2. Policy Limits & Sub-Limits
In the event of a loss, you want to make sure the limits of your cyber policy realistically match the exposure of your business. In addition, some policies impose sub-limits on certain loss exposures, such as notification costs and data restoration. Be sure to review and understand all the limits in your cyber liability policy – if they aren’t where they should be, make some changes.
3. Coverage for Acts & Omissions by Third Parties
First-party damages are losses that directly impact your business. Third-party damages are losses caused by customers or vendors for which your business may be liable. A policy with coverage for third-party losses can help your business better respond to the allegations made by others that your cybersecurity incident caused them harm.
4. Data Restoration
To a small business, the cost of having to replace or upgrade systems that have been compromised by a breach can be substantial. Be sure that your policy provides coverage for costs associated with getting your company’s computer system running again, the way it was prior to the cyberattack.
5. Policy Triggers
Coverage for some cyber liability policies is triggered on the date the loss occurs, while other policies are triggered on the date the claim is made. Take the time to understand how coverage applies under your policy so you can provide notice to your carrier in a timely manner.
Cyber liability insurance provides protection against the costs associated with security breaches, business email compromise, social engineering, ransomware, malware, viruses, etc. Oakwood D&O can help determine the best coverage for your company — whether you own a small business or manage a large corporation.
To learn more, please contact Eli Solomon, CEO, at eli@oakwooddno.com or call 323-686-7519.
