It’s commonly believed that cyber liability insurance and professional indemnity insurance are the same. While the two coverages may seem similar, they address different risks.
What is Professional Indemnity Insurance?
Professional indemnity insurance protects professionals against claims of negligence, service complaints, errors, or omissions in the services they provide. This type of insurance is designed for businesses that provide professional services or advice. Coverage can typically include legal defense costs, settlements or judgments, and breaches of confidentiality. However, professional indemnity insurance is unlikely to cover cyber incidents.
What is Cyber Liability Insurance?
Unlike professional indemnity insurance, cyber liability insurance is designed to protect your business from financial loss if it is a victim of a cyber incident. It can help cover a wide range of cyber risks, such as hacking and phishing attacks, malware, computer viruses, and data breaches.
Cyber insurance can help cover the costs of:
- Notifying customers about a data breach or cyber incident.
- Restoring personal identities of affected customers.
- Recovering compromised data.
- Repairing damaged computer systems.
- Legal fees and expenses if your business is held liable for damages resulting from a cyber incident.
Am I required to have cyber liability insurance and professional indemnity insurance?
You are not legally required to have either cyber liability insurance or professional indemnity insurance. However, the financial impacts of not having these coverages can be significant. Not all businesses need professional indemnity insurance, but most will need cyber liability insurance. Virtually every business is a potential target for cybercriminals. If your business stores financial information, uses technology or accepts payment, it is at risk of a cyberattack.
Let’s Talk
The best policy is as unique as you are. Contact one of our experienced Avery Hall agents today at 410-742-5111 to determine which plan works best for your business.