Factors affecting the need for Cyber Insurance for your clients
Certain factors affect a business’s chances to be the next cyber-attack target. As an insurance agent, you should be able to understand these factors and help your clients be prepared and safeguard themselves in advance. For this, insurance agents need to understand all the aspects related to their client’s business operations.
Insurance agents need to be aware of the importance of talking about Cyber Insurance with their clients. It can be an excellent opportunity for independent insurance agents to show their value to their clients by offering such solutions.
Here are some factors that will help agents to determine the vulnerability of their clients to cyber related threats.
- Your client handles sensitive information:
Businesses keep a record of various types of sensitive information such as employee’s personal details. This can be in terms of social security numbers, health information, or financial information. Businesses also store customer’s sensitive information that is highly valuable, such as their personal details, purchase details, or buying behavior. Attackers are on the look for such information as it is a useful commodity for them. Such clients are likely to be targets of data breach.
- Your client hosts a public website:
Businesses use websites in order to interact with their customers. Customers visit the website and register themselves to make transactions. E-commerce websites or blogs store customer’s login data such as email addresses or any other private information. Such information also has a high chance of getting breached.
- Your client’s employees use computers to do their job:
Almost all companies these days have employees who use either the firm’s or their own computers or internet-connected devices to do their job. Their devices contain confidential information regarding the firm’s operations. Theft or loss of such devices can increase the chances of leakage of crucial information related to the firm.
- Your client relies strongly on confidentiality:
Some firms have a high reliance on the confidentiality nature of their organization. For example, dating apps or firms that practice mental health have a high level of confidential information about their customers. Leakage of such information will not only affect the customers but will also have a massive impact on the firm’s reputation.
- Your client uses cloud-based services:
The cloud is an excellent tool for file sharing and collaboration and is being used by many firms. Firms also store sensitive information on cloud-based services. They use cloud-based applications for their day to day operations. But without proper governance and cyber insurance, using cloud-based services exposes a business to a data breach.
- Your client uses a website or has an online business:
Online businesses usually accept digital payment, including credit cards, and also stores sensitive customer information and medical or financial data. Such data also have high chances of being attacked by hackers.
- Your client uses a third-party vendor
Many businesses prefer third-party vendors who manage their database or provide an online shopping facility. In such cases, your clients are not clear about the level of security or coverage provide by the third party or their insurance.
It is essential for insurance agents to understand all the aspects of a policy before providing solutions to their clients. Insurance agents have to keep up with the evolving cyber insurance industry. Doing so will enable insurance agents to develop the most appropriate coverage for their clients.
If your client falls in even one of the above-stated categories, cyber insurance is essential insurance for their business. This will help them mitigate any sort of cyber-attack associated risk. Other business insurance policies do not cover cyber liability. Your clients need a separate cyber insurance policy that will cover risk exposures in terms of business interruption, loss of data, legal expenses, and data recovery.