Cyber liability insurance – protecting yourself from cyber crime
There’s no doubt about it, the arrival of the World Wide Web and its subsequent takeover of almost every facet of our lives has had a dramatic effect on modern culture. Many of the consequences have been hugely positive. Business models have changed and the growth of the global economy has been greatly facilitated by the speed with which we can now communicate. On a personal level, friends and family are never more than an email or a Skype call away, and it is now possible to locate everything from the nearest cinema to the nearest supplier of tropical fish in a matter of seconds.
But of course, with all the benefits come some negatives, and the rise of the Internet has also led to the rise of some unique challenges and dangers. Cyber crime has become big business for global organised crime networks and every business operation needs to be aware of the risks associated with using the internet, email and other business networks. These risks include identity theft, fraud, hacking, misuse of information and virus transmission and they can cause huge damage to a company’s financial standing as well as its reputation.
This type of risk has led to many insurance companies introducing a new type of cover known as cyber liability insurance. The cover offered will vary depending on the provider, but if you’re considering taking out cyber liability insurance, then it should deal with some or all of the following scenarios:
Fraud – particularly the forging of electronic signatures or emails which can lead to serious financial losses.
Virus transmission – a major problem especially for PC users which can wipe out files and destroy vital company information, or at the very least crash the company system for a prolonged period of time incurring losses.
Damage to networks or websites – again this can cause massive work delays which cost the company money, while malicious interference with a website can damage the company’s reputation.
Breach of privacy – For example, if you store customer data electronically and it is handled incorrectly by employees or your system is hacked. If this happens you may be held responsible and face a lawsuit.
Some of these instances may be covered by professional indemnity insurance, but if you run a company that relies on the internet and the security of your server, for example a ticket sales business or any other business involving online financial transactions, then this type of cover would be a wise investment. As it is a relatively new type of insurance, not all providers will offer it, so you may have to hunt around to find suitable cover. As always, if you’re not sure, then talk to your insurance expert and make sure you have the right type of cover for your particular business.
