Cyber Insurance

Cyber Insurance

What is Cyber-Insurance?

Cyber-insurance is an insurance product used to protect businesses from Internet-based risks, and more generally from risks relating to information technology infrastructure and activities. Risks of this nature are typically excluded from traditional commercial general liability policies.

Unfortunately, many companies don’t realize that whether they experience a data security breach Isn’t as much a matter of if it will happen as when. When a security breach happens, you’ll need comprehensive protection from an insurer that specializes in handling cyber risks, offers a full suite of integrated insurance solutions to help minimize gaps in coverage, and understands how to tailor coverage to your business.

Many organizations are not properly covered because of the misconception that their traditional insurance policies already cover technology-related losses. When most standard property-casualty policies were developed, “intangible” threats like hacking, computer fraud, corrupted data and intellectual property theft did not exist, much less pose the kind of threat they do today.

In today’s wired world, cyber attacks on businesses are increasingly common, and experts report that cyber attacks worldwide have been rising steadily. In a 2010 survey of more than 2,100 companies worldwide, Symantec Corporation found that 73% of small and midsized companies experienced a cyber attack in the past year, and that 30% of the attacks were “somewhat/extremely effective.” Symantec also found that the number of cyber attacks on enterprises increased 93% in 2010 over 2009.

Why your company needs cyber insurance:
A security breach could result in losses of hundreds of thousands or even millions of dollars, not to mention an incalculable loss of reputation.
The culprit may be someone close to your business...or could live halfway around the globe.
A breach can result from a simple mistake. An employee might misplace a laptop, Blackberry, or computer tapes or leave these in an unsecured location, such as an unlocked car.
Federal or state laws may mandate that your company take (and bear the expense of) certain measures in the event of a security breach.

The more people from whom your company collects personal information, the broader your exposure and the more you need insurance protection. Many risk managers and CFOs acknowledge that electronically stored data is their most valuable corporate asset. But are they sure this asset is covered? For more information, contact Level3 Insurance.

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