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Cyber Risks: Managing Versus Insuring

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No doubt you’ve heard about the cyber risks that continue to increase for businesses, whether it be data breach, hacking, phishing, or otherwise compromising systems. And hopefully, if your business stores any customer or sensitive data, you have measures in place to protect it. But there are two pieces of the risk management for cyber liability, the security plans in place, and the insurance for if an incident occurs. Let’s take a look at their differences.

Cyber Protection
Whether it is the Windows Defender program that may have come with your computers, or an extensive plan with monitoring, having a plan for defending your data is critical. Business.com1 suggests these steps that every organization should take:

  1. Teach your staff about cybersecurity.
  2. Set internal controls to guard against employee fraud.
  3. Keep your software updated.
  4. Use difficult-to-guess passwords.
  5. Guard your wireless networks.
  6. Use encryption on all types of data.
  7. Back up your data every day.
  8. Switch to the cloud.

And we’ll add one more – use multifactor authentication (MFA) for logins. In fact, MFA combined with teaching your staff and keeping software updated may be the three most important steps to get started.

Cyber Liability Insurance
Even with a great plan in place, cyber incidents can occur. If you do have a breach or other cyber breach, having the right insurance can help you recover. Depending on the policy, there may be coverage to help you:

  1. Notify affected customers.
  2. Restore systems.
  3. Assist with legal liability.
  4. Third party liability for business partners impacted by the breach.
  5. Ransomware demands to restore our data.

Some other business policies may offer our include coverage for cyber liability. However, it is often not enough to protect you form the scale of incidents that typically occurs. A “standalone” policy that suits your business’s specific needs may be a better fit for your coverage.

Contact Brandon Patterson from our team at 865.453.1414 or brandon@ownbyinsurance.com for more information on cyber liability coverage options for your business.

1 – Per https://www.business.com/articles/7-security-practices-for-your-business-data/