Cyber Liability Insurance Guide for Texas SMBs

Why Cyber Liability Insurance Matters for Businesses Like Yours

Cyber liability insurance, often referred to as cyber insurance, offers a layer of protection in the unfortunate event of a cyberattack or data breach. It's important to understand this type of insurance is different from general liability insurance. You might ask, "What exactly does cyber insurance cover?"

Understanding Cyber Insurance Coverage

While the specifics of a cyber insurance policy can differ between providers, it typically includes coverage for a wide range of expenses related to cyber incidents. Take a closer look at what a comprehensive cyber liability insurance policy can include:

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Is Cyber Liability Insurance Right for Your Business?

The question is not really if your business needs this coverage, but when you'll get it. Cyber insurance is no longer just a good idea; it's often considered essential for small businesses and required for some vendor relationships, especially for those that:

• Handle sensitive customer data

• Store customer information digitally

• Process online transactions

• Operate in industries with stringent data protection regulations

Cyberattacks can be financially devastating, especially for small and medium-sized businesses. Can you afford not to be covered? A 2017 study by Ponemon found that cyberattacks cost small to medium-sized companies an average of $2.235 million.

Who Needs Professional Liability Insurance?

While almost any business can benefit from professional liability insurance, certain professions are particularly vulnerable to liability claims. Here are some examples of those who should especially consider it:

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If you offer professional services in any of these fields, it's important to have adequate coverage to protect yourself from potential financial losses. Talk to one of our insurance agents to learn more about the specific types of coverage that are right for your business. An occurrence policy, for example, can provide coverage for claims that occur during the policy period, even if the policy has since expired. The number of years of experience a business has can also impact its insurance premiums.

Real-World Cases:

The impact of data breaches becomes even clearer with real-life examples. Below are a few instances of where companies had to pay for not having sufficient insurance policy coverage:

• In 2018, Facebook was hit with a class-action lawsuit over a security flaw. This exposed the account details of millions.

• Neiman Marcus faced similar issues in 2013, resulting in a $1.6 million settlement in 2017. This came after they had a hack that exposed the credit card info of thousands of their customers.

• Even Yahoo faced legal action when they didn’t properly disclose a data breach in 2016 which exposed private user information.

Finding the Right Coverage for Your Business

With the rising number of cyberattacks, demand for cyber liability insurance is higher than ever. Research by Marsh McLennan shows that prices for this type of coverage spiked by a significant 110% in just the first few months of 2022. Navigating this landscape can feel complicated, so finding a knowledgeable and trustworthy insurance provider who will take the time to learn your business can save on premiums while making sure you have the right insurance resources.

That’s where we come in. At Risk Solutions Agency, we specialize in helping small and medium-sized businesses navigate their insurance needs. We work closely with you to identify vulnerabilities, assess potential risks, and secure comprehensive cyber liability coverage. Our team can help manage risk and get your business the best insurance policy. Talk to us about an insurance quote for your business.

FAQs About Cyber Liability Insurance

How Much is Cyber Liability Insurance Per Month?

Cyber liability insurance costs can fluctuate depending on your type of business, the size, revenue, and how much coverage you choose. The limit on your policy also makes a difference. For instance, do you need first-party coverage or are you seeking more than just first-party? What about general liability insurance, will you bundle this with a general liability policy? What are your employee benefits? Do they include cyber insurance policy cover as part of their package?

What is Third-Party Cyber Liability Insurance?

Third-party cyber liability coverage specifically focuses on claims made by individuals or other businesses who’ve been impacted by a cyber incident related to your company. It helps cover costs like legal fees arising from lawsuits if someone sues you because their data was compromised due to a data breach at your company. It can also help you cover regulatory fines and penalties.

Do You Need Cyber Protection Insurance?

If your business uses computers, handles data (especially sensitive information like customer details), or operates online – then you definitely need it. This type of insurance is designed to enhance your level of protection against cyber attacks and data breaches. Think of cyber liability insurance as an investment in your business continuity, like general liability insurance, designed to protect you from substantial financial risks in an increasingly digital world.

Does Cyber Insurance Cover Theft?

Yes, cyber liability insurance can cover some forms of theft. This mainly includes theft that happens as a result of a cyber incident, such as:

• Funds stolen directly through electronic means because of hacking.

• Data theft – When hackers steal your or your customers' private info.

• Losses from phishing scams – Think about situations where employees are tricked. For instance, someone is tricked into giving up financial information that's then used fraudulently.

Cyber Insurance Coverage in San Antonio, TX

Cyber liability insurance is more important than ever. As more aspects of our lives become intertwined with technology, it's no longer an option, but a necessity. Especially with cyberattacks on the rise. Don't wait until it’s too late to protect your business. Talk to our team at Risk Solutions Agency to find out how we can provide a custom-tailored plan for cyber liability insurance. We're local and here to help you grow.