Regardless of what goods or services your small business sells, it is difficult to run your operations successfully without any reliance on information technology. From employing cloud storage to save customer data to utilizing e-commerce platforms for online payments and even adopting software solutions for payroll, having an adequate number of computers at your premises for every employee is vital for productivity. But despite how revolutionary the digital age has been when it comes to running businesses, it also has brought about an array of threats.
To make sure that your small business is not at risk of major losses that could force you to shut down operations, you must take the steps necessary to keep your business and customers safe. And one of the ways to do so is by purchasing cyber liability insurance. If you have never considered this type of coverage before, check out the following introduction to cyber liability insurance for your small business.
Which industries are in dire need of cyber liability insurance?
As a financially responsible business owner, you may not be willing to spend money on insurance policies that may not be relevant for your particular industry. You could be thinking that some types of businesses will require cyber liability insurance more than others. But you would be mistaken. The reality of the matter is that as long as your business makes use of both IT hardware and software, your operations are constantly at the threat of a cyber-security breach. That being said, you would be hard-pressed to come across an industry that would not benefit from this type of coverage.
Is cyber liability insurance necessary when you already have business liability insurance?
A common presumption that some business owners make when it comes to paying for cyber liability insurance is that it is unnecessary once they already have business liability insurance coverage in place. What these business owners are unaware of, though, is that these policies do not provide the same protection. Certainly, your business liability insurance coverage will ensure you are compensated if your computers, hard drives, and so on are damaged or stolen. But this compensation is limited to replacing the physical assets.
Cyber liability insurance, on the contrary, specifically protects your business when there are losses incurred due to cyber threats. For example, if you have a cyber-security breach and your customers' Social Security information is stolen, the lawsuits you could potentially face can put you out of business. Cyber liability insurance will pay for the assisted legal fees whereas business liability insurance will not provide any protection. You should also keep in mind that paying for cyber liability coverage does not mean you should stop paying for business liability coverage.