The number of electronic transaction is growing everyday in the modern world where technology is embraced and people are looking for alternative ways of doing business. One major factor that most online companies consider is the safety of the data transmitted daily, all the data stored in clouds or other locations are prone to hacking. Major companies such as yahoo, drop box, and LinkedIn have all in the past experienced data breach and this has prompted many other firms to look for security of the information in the form of cyber liability insurance. This is a new type of liability coverage that is geared towards protecting the companies financially in cases of electronic data breach security.
How It Works
Cyber liability insurance covers any kind of liability that arises out of unauthorized use of electronic data, unauthorized access to data or software, which is operated by a company. In basic terms, it covers data theft and the spreading of viruses to the company website. It is imperative to understand that it coves error or omission and negligence associated with data and use of the software as well. For example, if an employee sends personal information of a client to another clients email accidentally, the company will be liable to cover and the insurance works will cover such instances. Many may wonder about the difference between the traditional liability cover and cyber liability cover; however, the main difference is that traditional liability insurance covers only tangible objects; however, cyber covers non-tangible objects.
The Main Features
The main item covered by the insurance policy is network privacy; it protects you in case a client or member of the public suffers damage or loss because of your inability to protect sensitive information or data that is stored on your network. This issue often arises when there is data theft of security leaks, the data breach could cause inaccessibility to access the data which they entitled to. Moreover, modern polices are customized to cater for electronic media cover, this is vital in covering libel, defamation, invasion of copyright, privacy, slander of any kind of infringement that arises from online publication of electronic data.
In summary, cyber liability cover is important in keeping electronic data and software safe from hackers and there are numerous polices depending on the company taste and preference.