Why Cyber Liability Insurance Matters

Cyberattacks are an ever-present threat to businesses of all sizes. More than 40% of cyberattacks target SMBs, and the average cost of a data breach for SMBs is around $43 million. Even with strong cybersecurity measures in place, no business is completely immune.

Cyber liability insurance provides financial protection and support to help businesses recover from cyber incidents. It ensures your business can manage the financial and operational fallout of an attack, minimizing impact and aiding in recovery.

Key Coverage Areas

1. Data Breach Response Costs

A cyberattack can lead to significant financial and reputational damage. Cyber liability insurance helps cover:

• • Customer notifications
  • Credit monitoring services
  • Forensic investigations
  • Public relations efforts to protect brand reputation

2. Legal Fees and Regulatory Fines

Cyberattacks can lead to legal action or fines for non-compliance with data protection regulations like GDPR or HIPAA. Cyber insurance helps cover:

• • Attorney fees
  • Regulatory fines
  • Settlement costs

3. Business Interruption and Ransomware Payments

Cyberattacks often lead to downtime and lost revenue. Cyber insurance can provide coverage for:

• • Lost income due to downtime
  • Certain ransomware payment costs (though strengthening defenses is always the best approach)

How to Choose the Right Cyber Liability Insurance Policy

Not all policies offer the same level of protection. When evaluating cyber liability insurance, consider:

• Your business’s risk profile – What data do you handle, and how sensitive is it?
• Existing cybersecurity measures – Do your protections meet industry best practices?
• Policy coverage details – Does it cover legal fees, PR costs, and business interruptions?
• Industry-specific considerations – Does this provider understands your unique risks?

Aligning Insurance with Cybersecurity Strategy

Cyber liability insurance is a critical safety net, but it should complement, not replace, your existing cybersecurity efforts. To ensure coverage eligibility and reduce risks, businesses should:

• Conduct regular risk assessments
• Implement employee cybersecurity training
• Maintain strong access controls, such as multi-factor authentication (MFA)
• Align security practices with insurance policy requirements

Protect Your SMB with a Multi-Layered Approach

Managing cyber risk requires a comprehensive strategy that includes both preventative security measures and cyber liability insurance.

Take the next step in securing your business. Schedule a Cybersecurity Journey Review with Ostra to assess your risks and strengthen your defenses.