Just because you have cyber insurance, don’t assume you are covered

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Courtesy Van Wyk Risk Solutions

The worst words you can hear as a business owner are “you have no coverage.”

Claim scenarios

1. Your computer system is compromised by ransomware. Forensic providers contain the virus and determine the source of the infiltration is a vulnerability in your computer system. Upon recommendation from the forensic provider, you purchase new software to improve your security system.

2. A hacker obtains sensitive personal information from your computer system. As a result, a number of customers bring a claim against you for allowing access to their personal information.

3. An employee in your finance department receives an email purportedly from an established vendor changing the vendor’s banking instructions. The employee relies upon the fraudulent email instructions and wires $100,000 from your bank account to the fraudster. You discover the fraud when the real vendor contacts you requesting payment.

These types of cyber claims are made every day by every type of company. The worst words you can hear as a business owner are “you have no coverage.”

A standard cyber liability policy would not cover any of the three claim scenarios.

But there are additional cyber insuring agreements that would cover each of these claims.

The claims would be covered with the additional insuring agreements:

1. Damages and defense costs for covered lawsuits.

2. Costs for responding to regulatory claims stemming from the data breach, including any resulting fines or penalties.

3. Reimbursement of your funds.

Your broker should be composing the right risk solutions and offer additional insuring agreements to cover your cyber exposures.

There are internal precautions that also should be followed to protect your business, customers and employees from cyberthreats.

1. Thorough cyber-risk identification.

2. Formal cybersecurity plan.

3. Train employees to recognize cyberthreats.

And of course, protecting your company against losses from cyberattacks with proper cyber coverage.

Van Wyk Risk Solutions helps identify risks and provide solutions for that risk so you can focus on what you do best and rest easy.

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