Businesses in every field collect valuable information on their customers, including payment details and identifying data. While this information can help you target advertisements and build repeat business, it also exposes you to the risk of a cyber attack. Here are a few reasons you should add cyber liability coverage to your business insurance policy.

What Are the Costs of Data Breaches?

Many small business owners assume that data thieves only target large companies or government agencies. In fact, the opposite is true. Cyber criminals increasingly target smaller businesses, who typically don’t have the resources or expertise to adequately defend themselves.

The costs of a data breach can be severe. Even if the cyber criminals don’t interfere with your day-to-day operations, you may be held responsible for any losses your customers may experience due to stolen data. For many small organizations, the costs of a single breach can be enough to put you out of business.

Why Is Cyber Liability Insurance Important?

The standard liability coverage included in your business insurance policy may offer limited protection in the case of data breaches. However, the costs of a cyber attack or malware infestation can quickly exceed those limits or cause damages not covered by your policy. Specialized insurance designed to protect against those risks can help you keep going after a data breach.

What Does Cyber Liability Insurance Cover?

The specifics of cyber liability policies vary from one carrier to the next, but most offer some first-party coverage. This includes covering the costs of notifying affected customers of a data breach, repairing damaged computer equipment, and replacing income lost while your business was closed.

Most cyber insurance policies also provide third-party coverage, which shields you from lawsuits related to a data breach. Along with compensating customers whose data was stolen, this coverage will also pay any fines and settle the costs of breach of contract claims. 

Without this coverage, the cost of defending yourself in court could put you out of business, even if you ultimately win your case.

With over 25 years of experience and access to policies from some of the industry’s leading carriers, Western States Insurance Group Inc. is dedicated to helping business owners protect themselves from the unexpected. They proudly serve entrepreneurs throughout Lovington, Hobbs, Lea County, and the surrounding areas and will take the time to find a business insurance policy tailored to your needs. Visit their website for more on their business insurance services, get updates and tips on Twitter, or call (575) 396-1318 to request a quote today.  Follow Western States Insurance on Facebook.