Cyber Liability/Data Breach Insurance

What is cyber liability insurance?

Cyber liability and data breach insurance protects your business from cyber risks relating to information technology infrastructure activities, including breaches of your customers’ personal information (in both paper and electronic files.) While certain professional and general liability policies offer cyber liability coverage, it is important to make sure you have the proper level of coverage for your particular situation.  

What are the risks?

  • Hackers, attackers and intruders: These are people who seek to exploit weaknesses in software and computer systems for their personal gain. The results of this cyber risk can range from minimal mischief (creating a virus with no negative impact) to malicious activity (stealing or altering an individual’s information).
  • Malicious code: This is the term used to describe any code in any part of a software system or script that is intended to cause undesired effects, security breaches or damage to a system. This type of risk includes: 
    • Viruses: This type of code requires that you actually do something before it infects your system, such as open an email attachment or go to a particular Web page.
    • Worms: This code propagates systems without user interventions. They typically start by exploiting a software flaw. Then, once the victim’s computer is infected, the worm will attempt to find and infect other computers.
    • Trojan horses: Trojans hide in otherwise harmless programs on a computer, and much like the Greek story, release themselves when you’re not expecting it and cause a lot of damage. For example, a program that claims to speed up your computer system but actually sends confidential information to a remote intruder is a popular type of Trojan.
  • Lost laptops and mobile devices: Laptops contain a vast amount of personal information on their hard drives and in temporary files. A laptop in the wrong hands can expose countless passwords and enable access to financial accounts.

Why are medical and dental practices a target for cyber crime?

Health care entities have access to (and are expected to protect) valuable, confidential and personal information, including medical records (electronic and paper), billing information (credit cards, bank information, etc.), insurance information, and Social Security numbers. Compromised identities can be sold for as little as $50 each and cost a business at least $240 a year, per identity, in legal, public relations, advertising, IT forensic, credit monitoring and postage expenses.

How are health care and dental providers exposed?

  • Most breaches are caused by simple negligence.
  • Loss or theft of mobile devices or electronic files cause 68% of breaches each year.
  • Improper disposal of patient records.
  • Rogue employees.
  • Most sensitive data is not encrypted.
  • Increased use of electronic databases that store vast amounts of information.
  • Outsourcing IT.

What do cyber liability policies typically cover?

Typically, policies provide coverage in the following key areas:
  • Multimedia
  • Security and privacy
  • Privacy regulatory defense and penalties
  • Privacy breach response costs, customer notification expenses, and customer support and credit monitoring expenses
  • Network asset protection
  • Cyber extortion
  • Cyber terrorism coverage

Is cyber liability insurance expensive?

Not when compared to the potential cost of a breach or other compromised information. Cyber liability insurance is based on your current number of health care providers, and not rated on total number of people with access to the personal information or number of patient health records.

    Are there other types of coverage that I should consider alongside a cyber liability policy?

    “Fraud and abuse” is another important type of coverage that provides reimbursement of legal expenses associated with the following types of proceedings:
    • Disciplinary or disability rights (i.e. EMTALA, HIPAA, Stark, professional review, utilization review, and DEA violations)
    • Billing fraud and abuse
    Some “fraud and abuse” policies also cover regulatory fines and penalties associated with covered proceedings.

     

Contact Us

Looking for more information or a quote estimate?

Contact Mitch Laycock

mitchl@copic.com

720.858.6297

800.421.1834 ext. 6297

 

Or use our email inquiry form and we will follow-up with you directly.

Brochures

Downloadable coverage information