Why Your Business Needs Cyber Insurance
Firms and entities of all sizes appreciate the role of a general liability business insurance policy. For a small monthly premium, entrepreneurs can get hundreds of thousands, if not millions, in coverage. In turn, this protection takes care of different types of problems, including workers’ injuries, lawsuits from customers, and more. However, even though businesses heavily rely on technology, not many firms will look into the cost of a cyber insurance quote, let alone consider getting this type of policy.
Unfortunately, digital hacks and data breaches have increased throughout the last few years. Above all else, a cyber attack can cost your business dearly. Not only will you lose valuable information, such as customer details, payroll data, and daily schedules, but a data breach can severely damage your company’s reputation. Needless to say that, in this scenario, business owners might have a hard time measuring these hefty losses.
It should be no surprise, therefore, that many firms are resorting to digital coverage. In fact, companies can even get a cheap cyber insurance quote when they add it to their general liability business insurance policy. After that, entrepreneurs enjoy strong protection when a hacker breaches their data or network.
Cyber Crime Is on the Rise
Almost two-thirds (60%) of businesses in the United States had to deal with an attempted hack or cyber attack. Meanwhile, it takes firms more than six months to identify a data breach. This makes the threat of cyber attacks even more dangerous and concerning.
Above all else, businesses incur significant expenses as a result of these breaches and hacks. A company will lose, on average, over $230 if only one of their customers’ data gets compromised or breached.
To put that into perspective, hackers stole more than 445 million records in the United States during 2018 alone. In one year, digital criminals targeted 32.7% of consumers’ emails and social media accounts.
Furthermore, another 14% of Americans suffer from cyber attacks at least twice per year.
More Reasons to Worry
In light of the recent tensions in the Middle East, the U.S Department of Homeland Security is cautioning American companies and advising them to stay alert of potential digital crime.
Hackers can easily download software that allows them to engage in online criminal activity. In other words, anyone from across the globe can target small businesses and individuals.
Yet the recent confrontation with Iran, which has the world’s fourth largest cyber security edifice, only makes the threat of digital crime even more serious.
During the four year period from 2013 to 2017, Iranian hackers breached $3.4 billion worth of personal information. This happened after they attacked the online networks of over 170 universities across different countries.
Several years ago, a group of hackers that worked for the Iranian government targeted 46 financial institutions in the US. Bank of America and Capital One customers, as a result of the attack, couldn’t access their information online.
The banks even struggled to serve their account holders because of the data breach.
In short, a digital attack may impact your business directly and/or indirectly.
Expanding Your General Liability Business Insurance
Imagine if you are a business owner that used Bank of America or Capital One to process customer payments and deposit your employees’ salaries. How much money, delays, and lost income will the banks’ data breach cost you?
To make things worse, cyber attackers, whether they are domestic or international, could also hack your company’s Google Drive, email provider, or website hosting service.
Even if your customers or employees’ information isn’t directly compromised, losing access to crucial cloud software is a nightmare, if not worse.
Cyber insurance, on the other hand, is designed to protect you from these losses, regardless of whether hackers directly targeted you or a third party that your business relies on (such as a bank or payment processing software).
A Cyber Insurance Quote Is Cheaper Than a Cyber Attack
As mentioned earlier, companies have to incur more than $230 in losses per customer after a data breach. Perhaps even more importantly, small businesses pay an average of $36,000 to offset the damages of a cyber attack.
Meanwhile, a cyber insurance quote can be as low as $45 per month. While some companies have to pay more, a $65 monthly premium will likely be enough to get you over $250,000 in coverage.
To get an idea of how worthwhile this is, compare the $250,000 in coverage to the $36,000 that a data breach would cost you. To clarify, a low cyber insurance quote can give you enough protection to handle the cost of over six data breaches or digital hacks.
Myths About Cyber Security
Critics of digital insurance policies will say that a firewall or anti-virus system offers enough security. However, this is wrong for several reasons.
Firstly, hackers can still break through these anti-virus firewalls. Cyber criminals, from around the world, make $1.5 trillion per year. Because of how large this industry is, hackers are always developing new technologies that enable them to get through even the most advanced anti-virus systems.
In this situation, your website’s firewall can’t retrieve lost personal data or protect you from lawsuits from angry customers.
Secondly, a reliable anti-virus system will come with a minimum price-tag of $5,000. At times, firewall software may cost up to $25,000. A $65 per month (or $740 per year) cyber insurance quote, on the other hand, can get you a quarter of a million dollars in coverage.
Insured and Secured
Across all sectors and industries, businesses are vulnerable in the face of cyber crime. Many entrepreneurs will have no problem paying for a general liability business insurance policy. Yet they tend to forget about protecting their digital assets.
Data breaches cost a lot of money, whether they directly impact your business or if the hackers target a third-party company that you rely on.
Above all else, digital crime is rapidly growing. This is in part due to the tensions with Iran. On a larger level, though, this industry is dangerously expanding.
Now is the time to review your existing general liability business insurance policy. It would be a shame if your hundreds of thousands in protection don’t apply to hacks or data breaches, especially when you can easily find an affordable cyber insurance quote.