errors and omissions insurance The Importance of Cyber Liability for Nonprofits, Small Businesses | Axis Error & Omission
Error Omissions
Error Omissions
Submit your information below so we can contact you with a FREE quote
[All fields are required.]
Actual Annual Revenue:
Verify:
=
I have read and agreed to theTerms & Conditions
Error Omissions
Error Omissions

The Importance of Cyber Liability for Nonprofits, Small Businesses


The Importance of Cyber Liability for Nonprofits, Small BusinessesCyber, Privacy & Network Security Insurance is Essential for All Types of Companies

Retailer Target made the hit list as one of the most recent corporations to be the target of a data breach, with 40 million credit and debit cardholders potentially affected over the holiday season. But Target and other large corporations are not the only ones vulnerable to data breaches; nonprofits and small businesses are also on the radar of hackers and need to take precautionary measures to stem the potential of a breach as well as to protect themselves in the event private data is compromised.

Nonprofits

Nonprofit organizations, while not making headline news when it comes to data breaches, face similar threats as their for-profit counterparts. Nonprofits possess the type of valuable data that hackers target including employee data, credit card numbers, donor information and private health information. What’s more, their data breach threats come from the same sources all organizations face: an employee falling prey to email phishing; a stolen employee laptop; a disgruntled employee taking off with donor credit card numbers, etc. Further, the consequences of a data breach can be severe – from bad press, loss of trust, diminished donations, and financial harm to those whose data is stolen, to governmental investigations or litigation against the nonprofit that was hacked.

Small Businesses

Although small businesses have a much lower profile than large corporations, they are also vulnerable to breaches. Small businesses are perfect targets for cyber attacks due to a lack of the sophisticated security practices larger companies use to protect trade secrets and customer data. In fact, according to the 2013 Verizon Data Breach Report, three out of four companies attacked in 2012 were organizations with 100 people or less. And a similar study in 2013 by security company Symantec showed that small businesses in 2012 make up a larger percentage of those targeted for attack than in 2011—a threefold increase—with 31% of all targeted attacks directed at companies with fewer than 250 employees.

Cyber Liability Insurance

Of course, implementing data-protection protocols is key in helping to stem potential breaches, but as we have seen hackers are becoming increasingly more sophisticated in penetrating online systems and obtaining private information. As a result, more businesses and nonprofits are turning to Cyber Liability insurance, what we now consider as must-have coverage. But there are still those firms that have not made this coverage an integral component of their insurance and risk-transfer program. 2014 is the time to do so.

A Cyber Liability or Privacy & Network Security insurance policy can be designed to provide a broad range of protection. There is first-party coverage that insures for losses to a policyholder’s own data, lost income or for other harm to the policyholder’s business resulting from a data breach or cyber attack. Business interruption or loss of income coverage can be especially important for a small business or a nonprofit to help keep the lights on until normal cash flow is resumed. First-party coverage also includes the cost of notifying customers of a breach, and even the expense of hiring a public relations firm to mitigate negative publicity following a breach, as well as regulatory fines and penalties. In addition, a Cyber policy can include third-party coverage to pay for damages to individuals claiming financial (and emotional) harm as a result of a company’s data breach.

To find out more about how you can protect your organization with Cyber Liability insurance, contact the experts at Axis Insurance Services, LLC. We specialize in providing this coverage and have access to many types of policies to place the right solution for your business or nonprofit company. Give us a call at (877) 787-5258.

Comments

comments

Blogged on: January 16, 2014 by Mike Smith
Error Omissions
Error Omissions
Submit your information below so we can contact you with a FREE quote
[All fields are required.]
Actual Annual Revenue:
Verify:
=
I have read and agreed to theTerms & Conditions
Error Omissions
Error Omissions