How Important is Cyber Insurance for a Small Business?

As a small business owner, you’ve likely invested significant financial resources and time into your company. This necessitates an exhaustive approach toward risk management and loss control measures, as no business, regardless of size, is immune to things going wrong. In the digital era, this includes potential cyber incidents, such as data breaches. Fortunately, cyber insurance can help maintain financial security in the wake of such incidents.

What is Cyber Insurance?

Also known as cyber liability insurance, these policies live up to their name by potentially helping policyholders manage expenses and losses following a cyber incident. Malware, phishing, social engineering and other types of cyberattacks can quickly and unexpectedly devastate your business, but sufficient cyber insurance can help manage these damages and limit out-of-pocket costs.

What Can My Policy Cover?

Small businesses may face various financial repercussions following cyber incidents. Fortunately, filing a claim against your cyber insurance policy can garner a payout that may help manage the following losses and expenses:

• Incident response costs, such as notifying affected parties whose data may have been compromised

• Business interruption losses, such as recouping income you would have earned if not for delays

• Hiring outside help, such as digital forensics investigators, IT contractors and public relations firms

• Noncompliance fines, including those issued by regulatory agencies for substandard cybersecurity measures

• Legal costs, such as if you’re sued and need to hire attorneys to defend you

Why is Coverage Important for Small Businesses?

In the digital era, many businesses can be targeted by cybercriminals and hackers. Specifically, small- and medium-sized companies may be more likely to be attacked than they might have been a decade ago. As digital solutions and online operations have become more common in businesses of all sizes and across all sectors, perpetrators have gotten less picky with their targets.

Additionally, small businesses may lack the robust cybersecurity measures of larger enterprises, making them potentially more vulnerable.

We’re Here to Help

At Hall-Green Agency in Kent, Ohio, we’re prepared to help you find suitable cyber insurance. Contact us today to learn more.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.