Cyber Liability Insurance

What’s Covered In Cyber Liability Insurance?

Cyber insurance covers the range of expenses that arise when a breach occurs. These can include:  identifying and solving the breach, recovering data, customer notifications, PR costs, possible credit monitoring expenses, legal expenses, potential fines from compliance regulators, extortion costs from ransomware, and general business interruption.  There are three types of coverage, as described below:

First Party Coverage

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First party coverage is intended for damages sustained by a business due to a cyber breach.  These can include:

  • Notification Costs - Cost to notify affected individuals after a data breach
  • Breach Costs Inside/Outside - The aggregate limit (inside) or are separate (outside)
  • Business Interruption - Covers lost profits incurred due to not operating
  • Contingent Business Interruption - Losses from an interruption in 3rd party computer services or software
  • Data Recovery - The cost of recovering lost data
  • Extortion/Ransomware - Covers damage and ransom payments from an attack
  • Bricking - When computers and electronic hardware are damaged beyond repair

Third Party Coverage

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Third party coverage is used to cover damages sustained by a business’ customers or partners due to a cyber-attack.  This can include damages such as:

  • Network Security and Privacy Liability - Third party liability costs
  • PCI - Covers fines or penalties imposed by banks or credit card companies
  • Regulatory - In case you're fined by regulators (e.g., for breaching consumer privacy)
  • Media - When your content triggers legal action against you (e.g. - libel, plagiarism)

Cyber Crime Coverage

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Crime coverage pays for damages due to any type of illegal activity that occurs using digital means.  This can include:

  • Computer Fraud - Covers funds or property stolen resulting from a hack
  • Funds Transfer Fraud - When a criminal deceives a bank/institution to transfer funds
  • Social Engineering - When cyber criminals deceive a business to transfer funds willingly

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