A data breach is a security incident in which sensitive, protected or confidential information is copied, transmitted, viewed, stolen or used by an individual unauthorized to do so. Data breaches may involve financial information, personal health information, personally identifiable information, trade secrets of corporations or intellectual property.
A number of industry guidelines and government compliance regulations mandate strict governance of sensitive or personal information to avoid data breaches. If anyone who is not specifically authorized to do so views such information, the business entity is said to have suffered a data breach. If a data breach results in identity theft or a violation of government or industry compliance mandates, the organization may face fines, civil, or even criminal prosecution.
A Data Breach or Cyber liability policy is insurance coverage for liability that arises out of unauthorized use or unauthorized access to electronic data or software within your network or business. It’s important to remember that your business liability policy does not cover a data breach. A Data Breach liability policy fills that gap.
Data Breach Insurance protects your business against the expenses associated with a data breach, which can run into the hundreds of thousands of dollars. A lawsuit resulting from a data breach means your business is responsible for paying legal fees, court-ordered judgments or settlements, and other court-related costs. In addition, your business will probably have to notify customers or clients of the breach, provide them with credit monitoring services, and invest in public relations efforts to repair your business’ image. When you do carry Data Breach Insurance, it protects your business’ assets by paying for these and other related expenses. Data Breach or Cyber liability coverage allows you to focus on rebuilding and restoring your customers’ faith in your business without worrying about the data breach-related expenses.
There’s no policy that will prevent data breaches. The best your insurance can do is to help your business recover from a breach. The experienced agents at Boizelle Insurance Partnership will help you evaluate your data liability risks and build your policy around the needs of your business. An online retailer will have very different needs than a brick and mortar business with a small web presence. The size of the business, the number of customers, the type of data, and other factors will affect the coverage you need. Contact us today to create a data breach liability policy that works for your business.