Finding the right insurance for your cybersecurity business is an important step in protecting your business and achieving long-term success.
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As a professional in the cybersecurity field, you know the importance of protecting against unexpected events like cyberattacks. Your business must also consider a variety of other risks to protect against, from client lawsuits to workplace injuries. With the right set of business insurance policies, you can make sure that your firm is prepared for a variety of business risks and liabilities.
What insurance coverage do I need for my cybersecurity company?
While there are many types of coverage for companies to consider, these insurance policies are particularly important for cybersecurity firms to consider:
In the cybersecurity space, clients trust your professional recommendations and analyses to help keep their networks and systems safe. No matter how careful you are, though, there’s always a chance that you will make an error and cause your client financial losses. Even if you have done nothing wrong, a client could blame you for a problem in their security and file suit. Professional liability insurance can protect your business against these risks by covering lawsuits and damages brought by dissatisfied clients.
- Your firm is hired to monitor a client’s network for security breaches. Due to an employee error, your firm misses a critical vulnerability in the client’s systems, which leads to a hacker breaking into their network and crashing the whole system. The client needs to hire outside consultants to repair the network and also must to delay critical projects until the network is fixed. Your client sues for damages.
As a cybersecurity company, you know full well the threat that hackers and other cybercriminals present to businesses. While you are likely to have a robust cybersecurity protocol, you also understand that it’s not possible for every risk to be accounted for. Since hackers continue to develop new methods to exploit security vulnerabilities, there’s a possibility that your company could fall victim to an unfamiliar attack. In addition, there’s always a chance that human error could leave a loophole that hackers could take advantage of. The costs of recovering from a cyberattack are high, and news of hacks can have a disastrous effect on your reputation as well. Cyber liability insurance can provide financial assistance to help your company stay in business in the event of cyberattacks.
- Your company servers are breached and hackers steal confidential client information, including credit card information and email addresses. Your clients sue your business for failing to adequately protect their confidential data. Your insurer will pay for your legal fees and any settlements or judgments in the case.
Most companies in the IT industry work in space they own or rent, and as a cybersecurity firm, you probably rely on computers and other technology that are valuable and difficult to replace. If an unexpected disaster strikes, repairing or replacing your damaged property could be costly and time consuming. Commercial property insurance will help your company recover if a catastrophe occurs. Commonly covered perils include fire, lightning, explosion, vandalism, windstorm, and hail.
Commercial property insurance covers the following:
- Buildings belonging to or leased by your company
- Contents of the building, including furniture, computer equipment, and artwork
- Property of others while it is under your care, custody, or control
- Someone breaks into your firm’s offices and computer equipment with a total value of $25,000. Your insurance company will reimburse you for the loss.
Almost every company is exposed to general liability risk, even if they are in industries that are not known to be physically dangerous. If you meet with clients at your offices, visit clients at their offices, or have outside workers such as delivery people on your property, it’s a good idea to consider general liability insurance. You could be held liable if a non-employee is injured while on your property or one of your employees accidentally damages a client’s property. General liability insurance covers common bodily injury and property damage risks, as well as personal and advertising injuries, which can include libel, slander, and copyright infringement.
- Bodily injury: An electrician coming to your office to perform repairs slips on ice in your entryway, causing a back injury. Your general liability insurance would cover medical costs and legal fees if the electrician sues.
- Property damage: Your employees visit a client’s office for a consultation. An employee trips and knocks over an expensive vase, damaging it. Your general liability insurance would pay for the damages.
- Personal and advertising injury: Your company posts a regular blog about information security issues. One of the blog posts contains false statements about a competitor. The competitor sues your company for libel. Your general liability insurance would pay for the lawsuit and any settlements.
- A business owner’s policy combines general liability, property, business income, and extra expense coverage into a single package. This type of insurance can help small and midsize companies save money on premiums while obtaining a wide range of coverage.
- Workers’ compensation insurance is legally required for companies with employees in most states. It covers employees’ medical expenses and lost income if they are injured while working.
- Business income coverage will reimburse you for lost income and operating expenses if your business is unable to operate due to a covered reason, such as fire, storm damage, or other property damage.
- Employment practices liability insurance protects your business against lawsuits by employees accusing your business of wrongful treatment such as discrimination, harassment, or other employment-related issues.
Pricing and Quotes
Pricing for business insurance will vary based on the type of insurance coverage and the risk profile of your business. Insurers consider factors such as:
- Business size
- Number of employees
- Claims history
Businesses with higher risks will have higher premiums than those deemed lower risk. For example, a cybersecurity firm with a history of frequent claims will face higher premiums. Premiums also rise as you increase the limits of insurance. Different insurance companies have different models for rating risks, so it is worth comparing pricing across different insurers.
In order to get an accurate estimate on pricing, it’s best to get a quote from a reputable insurance company. Below we’ve highlighted a few of our trusted partners who offer coverage for IT businesses:
|Provider||Business Interruption||Business Owner's Policy||Commercial Auto||Commercial Crime||Commercial Property||Cyber Liability||Employment Practices Liability||General Liability||Product Liability||Professional Liability||Workers' Compensation|
Purchasing the right insurance coverage can protect your cybersecurity firm from a variety of major risks. Business insurance can help your company cope with unexpected disasters, whether it’s a fire or serious storm that damages your offices, a lawsuit brought by a dissatisfied client, or a client injury that happens on your property. Ensuring that your company has a wide range of insurance coverage can give you, your employees, and your clients peace of mind, knowing that if a catastrophe occurs, your company will be financially protected.