Is Cyber Liability Insurance Really Necessary?
In most cases, standard liability insurance does not cover a cyber attack event. Cyber attacks can leave you vulnerable and private information exposed. Some existing business insurance policies that render general liability coverage may provide some coverage when it comes to a cyber breach, but most CEOs find that there are gaps in what is covered after an attack occurs. By this time it is too late, that ship has sailed.
Chubb Group of Insurance Companies conducted a recent survey, and concluded that 65% of public companies choose to waive their option of purchasing cyber insurance, even after indicating that cyber risks were a top concern! A quarter of the companies surveyed are anticipating a cyber breach within the coming year.
One might assume that only high profile companies are the ones that are at a greater risk, but small to medium sized businesses are not exempt. 72% of all data breaches have occurred in small to medium businesses according to a survey done by the U.S Secret Service and Verizon Communications Inc. So what would be the average cost of a cyber breach? According to most financial analysts, 5 million dollars!
Cyber liability insurance is destined to become a necessity for most businesses, especially since most investors and customers would insist on some type of coverage in order to conduct business.
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