Cyber Liability Insurance Coverage
Cyber liability insurance coverage is no longer optional for healthcare organizations or professional service providers. A cyber insurance policy doesn’t eliminate the risks of your business or practice being attacked by hackers. It does, however, help you weather the storm when attacks do occur.
Who Needs Cyber Liability Coverage?
Cyber liability coverage may not be required by law, but it is a necessity for any businesses that use computers to store sensitive information about customers, clients, and/or patients. Many professions need this type of coverage from small business owners, to all of the following, and more:
- Professional Service Providers
Financial institutions and retail stores also need this coverage in today’s business world where dependence upon technology is continuously increasing.
The truth is that today’s businesses simply cannot afford to skip out on cyber liability coverage because data breach incidents are so widespread. More importantly, the technology to curtail them doesn’t seem to be evolving quickly enough to keep up with the constantly changing technology hackers employ in their efforts to breach your systems.
Specific Needs of Healthcare Professionals
While insurance protection against cyber crimes is necessary for professionals in all industries, it is especially critical for medical professionals who have HIPAA concerns in the event of a data breach. In the medical profession, HIPAA stands for your responsibility to safeguard any and all private and confidential information concerning your patients.
HIPAA laws have placed the burden on physicians, dentists, and healthcare organizations to protect this private information about patients. This means that you are responsible for informational security and ultimately liable for breaches. To do so without cyber insurance coverage is a risk most practices cannot afford to take.
Medical facilities, hospitals in particular, are attractive targets because they generate copious amounts of data about patients, employees, etc. This includes information that is deeply private and identifying, such as:
- Financial Information
- Medical Records
- Social Security Numbers
In addition to electronic records, data breach risk extends to paper files. Many physicians still keep paper files and write prescriptions on paper, for instance. That is a big exposure.
Further, employees and contractors also present a high exposure in regard to data breach risk. They steal personal patient information and sell it to third parties. Even mistakes and oversights can lead to a data breach.
This is all information that could prove to be a great deal of mental and financial distress to patients if released during a hacking event – especially due to the personal and financial nature of the information.
Why Buy a Cyber Security Insurance Policy?
Data breaches are far more common in businesses today, of all sizes, than anyone cares to admit. From big name organizations like Sony and Target to small mom and pop businesses, hacking attacks happen all the time.
Unfortunately data breach liability isn’t covered by a general liability policy for this kind of coverage. Data breach insurance coverage offers protection from a wide range of situations that could stem from the actual breach. Depending on your policy it may cover any of the following:
- Cyber extortion expenses (for hackers that ransom your data)
- Cyber forensics and data breach investigation expenses
- Information recovery costs
- Judgements and settlements
- Legal fees
- Noncompliance fines and penalties
- Notification costs (according to HIPAA requirements as well as state regulations)
- Time and energy involved in notification
- Providing credit monitoring services to victims
- Public relations and reputation repair in the aftermath
- Loss of business income resulting from cyber event
- Restoration costs for your IT systems
Cyber attacks can be devastating for your practice or business – especially if you don’t have the right kind of insurance coverage to help you work through the public relations issues and financial fallout that occur in the aftermath of a data breach event.
Phishing scams, or fraudulent emails sent out in an effort to obtain personal, financial, or even privileged and protected information about individuals are another big problem to address. These scams can hurt the reputation of businesses and, in some cases, cause your practice to violate confidentiality because the messages appear to originate on trustworthy, not to mention well-known, sites.
Healthcare organizations have the added burden of meeting HIPAA standards for cyber liability coverage so make sure that the policy you choose an appropriate policy to meet those requirements.
Securing Your Data
Prevention is always the best cure when it comes to avoiding data breaches. Unfortunately, most businesses are particularly vulnerable in this area. Medical practices often face the greatest potential risks from cyber attacks and data breaches, so it’s especially important for businesses in the medical field to take actionable steps to secure the information you’ve been entrusted with.
These are a few of the steps you should consider taking.
- Create a data breach response team before a data breach occurs. This team will be responsible for taking action the moment a breach is discovered.
- Conduct periodic risk assessments to determine how vulnerable your system is.
- Update IT systems, hardware, and software regularly as patches are frequently released to guard against known threats.
- Use encryption software to protect your data.
- Limit personal devices allowed to access your networks.
- Educate and train your staff about cyber threats, cyber security, and the role they play in protecting patient, employee, and customer data.
Finally, you must understand that statistically speaking it’s not a matter of if your data will be breached, but when. When that time comes you need to have adequate cyber liability insurance coverage or it could place your business in serious jeopardy.
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Call Professional Protective Alliance today at 800-864-3952 to learn how we can help you get the cyber liability insurance coverage you need to protect your healthcare practice.
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