Does My Business Need Cyber Liability Insurance?

With the recent increase in cyber attacks, no business is safe from threats. Contrary to popular opinion, small businesses present an easier target for cybercriminals than large multinational companies because their cyber defenses are often far less robust. Consequently, whether you own a business in Illinois with ten employees or a hundred, you need to protect yourself from the rise in data breaches, phishing attempts, and other cyber incidents with the appropriate insurance. 

There are two main types of cyber liability insurance: first-party coverage and third-party coverage. First-party coverage is for paying costs that directly impact your business. For example, if your network is hacked and sensitive customer information is stolen, first-party cyber liability insurance can be used to cover any of the following:

  • Extortion payments
  • Hiring an outside firm to investigate the data breach
  • Regulatory fines
  • Notification to impacted customers
  • Crisis management and public relations
  • Customer credit and fraud monitoring services

The second type of coverage, third-party cyber insurance, protects you if a client blames you for failing to prevent a data breach or cyberattack at their company. Third-party cyber insurance is predominantly used by IT consultants that may be hired to provide specific technological services to a company. This type of coverage can pay for legal defense costs, settlements with the third party if settled out of court, and judgments that you may be required to pay after a breach. 

At Taake Insurance Agency in Columbia, IL, our professional team of insurance masterminds will help determine if cyber liability insurance is needed for your business. Call us today to schedule a no-obligation consultation to learn more about our insurance offerings.