5 Reasons Why Your Company Should Get Cyber Liability Insurance
There are many different insurance types that you can get, either for your business or in your personal life.
In the business arena, there are things like business interruption insurance and product liability insurance. You might need something like vehicular insurance as well to cover possible damage to the truck fleet you use to transport your goods to stores.
Today, though, we’ll talk about a different kind of insurance for your business: cyber liability insurance. If you’ve never heard of it before, cyber liability insurance can protect you if a hacker gets into your company’s network and steals data or trade secrets. It can also assist you if your employees make mistakes that result in monetary losses.
There are more than a few compelling reasons why you might want to look into cyber liability insurance for your company today. Let’s talk about some of them right now.
There Are More Cyberattacks Now Than Ever Before
One reason why you should think about cyber liability insurance is that cyberattacks are increasing at an alarming rate year by year. The FBI has an Internet Crime Complaint Center. They report that in 2020, cybercrime cost companies $4.1 billion.
The numbers keep going up because, frankly, cybercrime is profitable. Hackers know that if you develop sophisticated ransomware and inject it into a company’s network, that company is liable to pay plenty of money to get their data and trade secrets back.
Cyber liability insurance is an extra protection layer against hackers, on top of online security measures you might take already. Some companies feel like the expense is negligible compared to what might happen if you elect not to get it.
Your Workers Can Make Mistakes
You probably have security measures like two-factor authentication set up that make it tougher for someone unauthorized to access your company’s software suite. However, some workers make mistakes.
They might be careless about where they leave sticky notes with their password on them, for example. They might make a password to get into your company’s network “password123” or something else that’s easy to guess.
You can conduct onboarding and training sessions for longtime employees to remind them that they need to be cautious about how they access your network and who they allow to use their work computer or tablet. Still, some workers seem slow in the uptake, and one careless employee incident can let a hacker access your company’s most crucial data. You’ll certainly be glad you have cyber liability insurance in place if that happens.
You Can Write It Off on Your Taxes
It’s also worth mentioning that you can usually write these expenses off on your taxes at the end of the fiscal year. A spot exists where you can write off several business expense varieties, and cyber liability insurance is no exception.
This way, you’re spending money on the policy, but you’ll get it back, in a sense. It’s not as though that money is gone for good. You’ll see a return on it, even if no cybercrime incident takes place during the year.
You Can Convince Various Investors to Put Money into Your Company
It could be that you want to expand the business because of strong early returns. You’re making money, and the company is catching on within your niche.
You may not be sure about where or how to get some additional funding, though. You might approach a venture capital firm to see if they’re interested in investing, or you might try to find an angel investor instead.
If you want to attract individuals or financial entities like banks or credit unions that will put up the money so you can expand, you need to convince whoever is doing the lending that their money is safe.
While there's no such thing as a one hundred percent safe investment, these entities or individuals will probably be much more comfortable putting up that money if they see that you have various insurance types.
When they see that you have cyber liability insurance, that shows them that you’re considering every eventuality. They’ll give you the money you need, and you can expand accordingly.
You May Be Ready to Launch Some Aggressive New Initiatives
Perhaps you’re ready to move forward and take your company to the next level. Maybe you’re going to expand into foreign markets. You might be interested in taking your company national where before, you were just a small mom-and-pop business entity.
When you do these things, you’re expanding beyond your comfort zone. There’s nothing inherently wrong with that, but when you do so, you’re also often opening your business up to potential data leaks.
Until your new business model has stabilized a bit, expansion means hackers will have more of an opportunity to probe your network for weakness. If you understand that’s liable to happen, you’ll be glad to know that cyber liability insurance is in place, protecting you.
If you’re feeling convinced now and you want to get cyber liability insurance for your business, you can talk to some of the companies out there that offer it. There are many possible policies that might interest you, and you’ll need to go over each one to see the details.
Like any insurance policy, you’ll want one that you can comfortably afford but which also has all the protections you need. If you’re not certain which one to get because of all the legalese featured in the fine print, you can speak to an insurance broker specializing in this area.
They might charge a small consulting fee, but they should be able to identify the policy that will work best for you. You can then pick the one that applies to your industry and whatever it is you make or offer.
This policy will allow you to work toward getting noticed in your niche, expanding, and whatever else appeals to you. Your company might achieve unprecedented success with one of these policies.
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