In today’s digital landscape, the threat of cyber attacks looms larger than ever before. Recent statistics reveal a stark reality; while 41% of small businesses have fallen victim to cyber attacks in 2023, only 17% are adequately protected by cyber insurance. Our expert agents at Staples & Associates offer insights on why you should consider adding cyber insurance to your business’s’ protection plan.

What is Cyber Coverage and Why Does My Business Need It?

Cyber liability insurance coverage can help businesses pay for expenses related to ransomware attacks, phishing scams, or data breaches. Your company may have multiple areas of liability, and it’s important to talk to an agent to help you assess what might be at risk. 

Planning for how your business will operate in a crisis is daunting, but Staples & Associates is here to help advise you. Here’s what you need to know about cyber insurance. 

Cyber insurance is broken into first-party and third-party coverage. 

First-Party Coverage

First-party coverage insures the direct losses and expenses resulting from an attack, such as legal fees, IT support or response costs, data recovery expenses, extortion or ransom payments, costs due to an interruption in business, and expenses for abating reputational damage with public relations or crisis management services.

Third-Party Coverage

If a third party might be affected by your business’s cyber attack, you should consider third-party cyber liability insurance. For example, a customer whose privacy or data was breached sues your company. Other examples include fines incurred from legal violations due to the attack or media liability legal cases where libel, slander, or negligence are accused. 

Cyber Insurance Outlook for 2024

The breadth and depth of the cyber threats to businesses can change quickly. Staples and Associates recommends that businesses consider the following in 2024:

• Data Collection: Business owners that collect data through processes like HR or marketing must ensure that they are following existing laws for data collection and storage, on state, national, and international levels. 
• Artificial Intelligence: AI has the power to amplify cyber threats to businesses. Attackers can automate false password attempts, malware distribution, and other scams.
• Ransomware Attacks: These attacks can be hugely disruptive to operations and require payments to resume access to sensitive data or softwares.
• Business Email Compromise: Scammers often use email to impersonate top executives or company leaders to exploit employees. 

When a cyber attack hits, a business may stop everything and invest all available resources to deal with the fallout. At Staples & Associates, we understand the importance of safeguarding your business against cyber threats. That’s why we urge you to take proactive measures to mitigate risks. Contact us to discuss your options.