What Is Commercial Cyber Insurance?
Commercial Cyber Insurance is a policy designed to protect a business’ liability for data breaches related to customers’ personal or sensitive business information. Cyber Insurance provides protection and coverage for the security and privacy of digital information and data should your business or organization be a victim of a cyber breach or cyber events.
In Canada, as in many other countries, the digital realm presents various challenges and vulnerabilities that necessitate robust protection. Cyber Insurance Canada serves as a financial safety net, helping businesses recover from the fallout of cyber incidents such as data breaches, cyber-attacks, and any other malicious cyber incident.
Who Needs Commercial Cyber Insurance?
Every business can benefit from commercial cyber insurance. If you sell products through e-commerce or maintain electronic customers’ records, you should carry cyber insurance to protect your organization from risk. A breach of the systems containing this personal and commercial information can be extremely time-consuming and costly.
What Does It Include?
Cyber Insurance Canada typically covers a wide range of cyber-related risks and expenses. These can include:
Data Breach: In the event of a data breach, where sensitive data is exposed or compromised, cyber insurance can cover the costs of notifying affected parties, data restoration, legal fees, and public relations efforts to manage the fallout.
Cyber Attack: A cyber attack encompasses threats, such as ransomware, malware, as well as phishing scams. Cybersecurity insurance helps businesses recover by covering costs related to system restoration, data recovery, and negotiating with cybercriminals.
Cyber Risk Management: Cyber security insurance providers often offer expert guidance and resources for risk management, helping businesses fortify their cyber defences and reduce the likelihood of incidents.
Incident Response Plan: Having a well-structured incident response plan is critical with respect to a cyber incident. Cyber insurance can support the development and execution of such plans.
Cyber Extortion: If your business becomes a victim of cyber extortion, where criminals demand payment to release your data or systems and identity theft incident cyber insurance can provide financial assistance.
Identity Theft Incident: In cases of identity theft incidents affecting your employees or customers, cyber insurance can cover the associated expenses and provide support for affected individuals.
What Are the Risks Associated with Cyber Spaces?
The digital realm is rife with cyber threats with potentially grave consequences.
These risks include:
Data Restoration: Recovering lost or data compromise can be expensive and time-consuming.
Security Breach: Breaches can damage your reputation, undermine consumer confidence and lead to legal action.
Cyber Criminals Infiltrate: Sophisticated cybercriminals constantly evolve their tactics to infiltrate systems.
Sensitive Data: The theft or exposure of sensitive information can result in incidences of identity theft and financial loss.
Cyber Risk: Businesses face ongoing cyber risks that necessitate diligent cyber security measures.
How It Will Affect You If You Are Not Insured
Without cyber liability insurance, the financial burden of handling cyber incidents falls squarely on your business. The costs of data recovery, legal expenses, regulatory fines, and reputation management can be overwhelming, potentially leading to financial ruin. Moreover, the loss of customer trust and confidence can have long-lasting consequences.