As new cyber threats develop every day, the need for cyber insurance increases. But who needs cyber insurance? Many struggle to understand what cyber insurance covers and why it’s a critical part of any business.
Tactics, such as social engineering and ransomware, are becoming more sophisticated. Social engineering attacks exploit human interaction and are meant to deceive. This involves hackers who trick and manipulate their targets into disclosing private information or access to secure systems. Ransomware, however, is a type of malicious software that infects a computer system and holds system access and data hostage until a ransom is paid. These attacks have become more and more common and the amount of money that hackers are demanding continues to rise.
"While the impact of a cyber attack on a large company can be in the millions, the financial impact on small and medium-sized businesses can still reach up to $500,000 and more."
When educating your client or customer, it’s important to fully understand the potentially catastrophic costs of a cyber attack. This can help put the cost of insurance premiums into perspective for clients. While the impact of a cyber attack on a large company can be in the millions, the financial impact on small and medium-sized businesses can still reach up to $500,000 and more.
It’s important to understand that an informed client is more likely to purchase a cyber liability policy. In addition to the known risks and exposures, there are a number of rules and regulations that must be followed when using certain types of data. This includes the Payment Card Industry Data Security Standards (PCI-DSS), Health Insurance Portability and Accountability Act (HIPPA) rules and regulations, and General Data Protection Regulations (GDPR). If these rules and regulations are not properly complied with, the result can be serious fines and penalties.
Educating your clients about the different types of cyber policies available will help provide your clients with an accurate and appropriate quote. Understanding the difference between a commercial general liability (CGL) policy, a business owner’s policy (BOP), and a stand-alone cyber liability policy is important in order to present your client with the proper coverage. In many cases, a CGL policy may not provide the cyber protection that clients are looking for. With ProWriters, you can quickly and efficiently compare cyber insurance carriers and quotes in a matter of seconds with our innovative online platform.
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