The internet has made our lives easier, but it comes with its share of risks. In just one week, you could receive a threatening automated phone call, 200 junk emails, five worrisome text messages and three fake Facebook invites, all trying to bait you into giving up personal information. These days you cannot surf the web without having an active firewall. The cyber threat is very real.
Cyber insurance, also known as cyber liability or cybersecurity insurance, was created to cover the millions of dollars’ worth of damage companies suffer because of hacker attacks and data breaches. In 2017 the first personal cyber insurance endorsement for high-end homeowners was introduced, and now several insurance companies offer these endorsements.
What Cyber Insurance Covers
Most policies will cover the damages and expenses related to cyberattacks including:
- Cyber extortion
- Cyberbullying
- Data restoration costs
- Identity theft costs
This means if you accidentally unleash a virus, you will have coverage to restore your system and reinstall your software. Your insurer may also authorize ransom payments to avoid disclosure of stolen information.
There is an extensive list of different cyber threats. However, most of them will be covered under fully featured personal cyber insurance policy or endorsement.
How Cyber Insurance Works
Many insurance companies offer personal cyber coverage as an endorsement to your homeowners or renters’ policy and can also be purchased as a stand-alone policy. The coverage ranges from $50,000 to $250,000.
The policy/endorsement has limits and sub limits. The policy limit is the total amount of damages covered each year, while the sublimit is the total amount of coverage provided for each covered event (example: $25,000 for cyberbullying). Some policies will also have a deductible, which is the amount you must pay out-of-pocket per claim.
Why You Need Cyber Insurance
According to the Pew Research Center, nearly two-thirds of Americans have been exposed to data theft. Those who have had their identity stolen will tell you how traumatic it is having to spend countless hours and hundreds of dollars trying to re-establish their credit rating, cancel fraudulent claims and reissue official documents.
If you have children, especially teenagers, the risk of a cyber event is heightened. Things like gaming platforms and websites that your children are accessing, expose your family to invisible threats. Furthermore, they are less experienced than you are at recognizing phishing attempts.
Controlling The Risk
Of course, insurance is not enough, nor will it prevent you from being the target of an attack. Follow these tips to stay out of trouble:
- Secure your system: set your firewall and security to the highest settings.
- Get rid of backdoors: reboot your router periodically.
- Hide your network: router settings allow you to hide your network from public view.
- Create multiple network accounts: limit your connected smart utilities to their own sub- networks so hackers do not gain complete network access if they attack your smart toothbrush or take over your doorbell.
- Employ secure passwords: passwords remain your first line of defense against hackers – make them strong with characters & symbols and change them often.
- Use multiple passwords: do not use the same password for every account you have.
- Shield your online presence: remove personal information from social sites.
- Manage your subscriptions: make sure you know what you are subscribed to.
- Always go to the source: do not trust an urgent message or text from one of your institutions — go to their website or call the normal phone number to verify the message.
Contact Clyde Paul Agency About Cyber Coverage
Technology and the internet are now a part of our everyday lives. Taking the necessary precautions to protect your family and personal information has never been more important. A personal cyber policy can be part of that protection. If you would like to learn more, please contact us at 201-991-7598 or Info@ClydePaul.com.