Cyber Security and the Importance of Cyber Liability Insurance



Protecting your sensitive information

Cyber-attacks and hacking is a big business, and even the biggest companies are not safe.  In the past year alone we have witnessed Target, Adobe, Facebook, Apple, JP Morgan, the US Government’s Federal Reserve and the Energy Department to name a few, all fall victim to some form of cyber-attack or hack.  All of these attacks compromise the business’s most valuable information; clients, patients, or employee’s personal and financial data.  Private information was exposed including, names, social security numbers, addresses, date of birth, credit card information, were all posted on hacking sites for identity thieves to use.  Unfortunately, most companies have no idea that their business liability and standard property insurance will not cover their most important asset, their data.  However, cyber liability insurance does cover these things.

Cyber liability insurance helps not only protect a business in case of a cyber-attack or hack, but also assist a business with risk management, by making sure the right protection is in place to help prevent the attack.   In some cases, cyber liability insurance will cover legal defenses, settlements, crisis response, including the cost in notifying of affected individuals, and business interruption costs and fines.   A study by NetDiligence, a security risk assessment firm in Gladwyne, PA, found that for 117 privacy breaches, the average cost is $5 per lost client record, with the average breach exposing 100,000 records.  A loss that large would make it very difficult to stay afloat for most businesses, if they even make it through the whole process.  Cyber Liability Insurance is not only recommended, but in this day and age, should be mandatory for all businesses dealing with sensitive data, especially in healthcare and the workers’ compensation industry.

At Orchid Medical, we feel our most valuable asset, our data, should be protected at all times.  We accomplish this by investing in the most up-to-date security hardware and software, training employees on how to handle private information safely, and by also insuring our data with the appropriate level of cyber liability coverage.   This not only gives us peace of mind, but allows our clients to rest easy knowing their sensitive data is protected at all times.