Who Needs Cyber Insurance?

Most companies get standard business insurance to cover tangible losses and damages, such as loss of physical property and damages suffered from natural and manmade disasters. But what about when a company suffers the loss of something other than physical assets, including the loss of intellectual property like data?

While many companies do not even take such losses into consideration, with the ever-increasing reliance on the Internet to do business, covering intangible losses such as data is more important than ever. In fact, insurance companies now realize that businesses need to protect their intangible business assets now more than ever. But on the business side, how can you be certain of the worth of intangible data? How can you really know how much coverage is enough?

According to www.networkworld.com, the following are some areas of coverage that are not associated with physical assets a company might have, but instead cover a business’ intangible property:

Different types of coverage:

  • Data breach
  • Civil Action
  • Cyber extortion
  • Virus liability
  • Content liability
  • Lost income
  • Loss of data
  • Errors and omissions

Rates of coverage vary as a result of the uncertain nature and worth of such assets. Generally, protecting these types of assets runs from $5,000 to $15,000 per million of coverage for smaller firms that make less than $100 million in annual revenue to anywhere from $10,000 to $25,000 for larger firms, and $20,000 to $50,000 for those companies pulling in over a billion in annual revenue. This takes into account the risk factor, as companies with a higher risk pay higher insurance premiums.

Let’s take a look at the top businesses currently with coverage: Out of the top 100 corporations in any given industry, it is estimated that only about a quarter have data protection coverage. Another 15% are in the market looking for coverage, and 40% to 50% will more than likely be buying such coverage within the next year.

For more information about the importance of cyber insurance, visit: http://www.networkworld.com/news/2011/102411-cyber-insurance-252145.html?page=1