What is Data Compromise Coverage?
As you know, with so many people working from home, there are so many additional cyber risks. You have to consider if your employees’ networks are secure, or what they are really doing on the computers at their home while they’re working.
Data compromise. That’s a phrase that sounds fancy and complicated. You might as well glaze over.
NOT. It’s very important! For small, medium, and large businesses, non profits, everyone. If you or your employee has an incident where personal information of your customers, staff, or your business is exposed, there are costs associated with notifying the individuals. These costs can be $250/person notified! Wow. What if you have an incident with 1000, 10,000, or 100,000 people? These costs add up super quickly.
So what exactly is included in these costs? Some items would be:
First, you have to get an IT review, sometimes by an external company, so you can determine how far the breach went exactly.
Secondly, you need to contact lawyers and you have to pay your legal costs for them to advise you on how to best respond.
There will be the actual cost of notification – this could be mail-outs, advertisements in the local paper, online advertisements, mass emails, etc.
You will have to create information about the breach – who does this? A consultant may help you figure out how available you need to be to answer questions. Either you take the time to comprise this information, or you pay someone else to do it. People are going to want to know the nature of the breach.
There are going to be reputational costs, so you will want to cover your PR costs to help you mitigate those. You may even have to hire a PR firm!
You may have costs to notify the authorities and meet all of their requirements.
Luckily, insurance is available! You can typically choose your limit and your deductible. Please note – if you have an incident, report it to your insurance company as soon as you can – there is often a 60 day notice requirement. Just confirm with your broker what the notice period requirement is.
So now, I bet you’re happy you read this. You’re thinking “Oh boy, I’ll have to call my insurance broker!” Yes. Yes, you will. And we will be ready for your call.