Doing business in the information age is exciting, as owners find new ways to reach customers in far flung locales via the Internet. Businesses everywhere can expand their potential customer base by using the Internet, but by doing so, they open themselves up to certain liabilities. If your company is doing business online, and in the process, collecting sensitive data protected by privacy acts, it’s important to protect your business in the event of a data breach. Cyber Insurance is a relatively new insurance product designed to provide businesses with piece of mind as they do business in today’s online environment.
Even The Best Software Isn’t Foolproof
Today’s enterprise software is usually designed with data security in mind, but having good software will not always protect from potential data breaches. Even the biggest, most successful multi national businesses have experienced massive data breaches, so any business is a potential target. Unfortunately, the various privacy acts put a heavy burden on businesses handling sensitive data, and even unintentional breaches that are not the fault of anyone associated with the company can be declared as negligent.
Cyber Insurance Components
The complete cyber insurance package includes three elements. The legal liability component is your protection against lawsuits stemming from a data breach. In addition, there is a business interruption component, which compensates lost revenue resulting from down time from a data breach. Finally, there is coverage for breach notification costs, which, depending on the size of your customer database, can be considerable.
Handle Sensitive Data? Consider Cyber Insurance
If your company regularly handles sensitive data, obtaining a cyber insurance policy might be a prudent move to protect your company in the event of a data breach. OTC Insurance will be happy to explain how the insurance works, and the appropriate level of coverage for your business.