According to a 2011 survey from Symantec, (the largest maker of security software for computers, best known for its Norton brand), cyber attacks cost companies, on average, $470,000 in lost revenue, downtime and loss of brand confidence.
Claims covered by cyber liability insurance can vary widely in terms of nature and severity. We are seeing a trend of more technology firms being required to have cyber liability as part of their vendor and third party contracts. We are also finding that after audits are completed, accountants are beginning to suggest that their clients invest in cyber liability policies. Cyber liability insurance is important for any company that maintains a website, conducts business via the Internet, accepts payment via the website, or stores non-public client and/or employee information within a network.
For example, groups who may have concerns about HIPPA laws, such as hospitals or medical billing companies who service physicians and medical practices, should consider coverage. Most banks, especially larger ones, have discovered that ordinary general liability plans do not cover exposure of cyber liability and have started to require first and third parties to have cyber liability coverage as part of their vendor contracts. Any company or organization that does business on the Internet, has a website, or is paperless, can be at risk to hackers and identity theft.
If a business experiences cyber hacking, the cost to repair credit, discharge fraudulent loans and seek damages from emotional stress could be prohibitive. Cyber liability typically covers the business costs to fix the problem, notification, and the monitoring (years of service), as well as identity theft and ruined credit.