The Risks of Technology: Understanding Cyber Liability

, Cyber Liability InsuranceToday, doing business online is standard operating practice for many self-storage businesses. Facility websites, online marketing, social media, property management software, electronic databases and cloud-based computing streamline many necessary tasks, improve efficiency, and enhance both marketing and customer service. However, this reliance on technology also may create exposures that could result in costly lawsuits and claims.

You have been hearing the term “cyber liability” more often in recent months as a result of high-profile cyber incidents. With the widespread adaptation of technology across hundreds of industries, cyber liability is now an issue that affects every business with exposures including computer viruses, data theft, identity theft and other cyber crimes.

Insurance companies are responding to the growing need for cyber liability coverages by developing new policies to address a wider range of exposures including both first-party and third-party liability.

First-Party Coverage

Business Interruption: Interruptions in business due to breaches of a company’s network
Crisis Management: Costs of retaining a public relations firm to help mitigate damage to the policyholder’s reputation and brand
Extortion/Threat: Costs to investigate, negotiate and settle threats made against the policyholder related to international computer attacks
Privacy: Expenses for breach response services such as notification, credit monitoring and identity/credit repair

Third-Party Liability Coverage

Security: Failure of network security to prevent the transmission of computer viruses or hacking
Privacy: Failure to protect private or confidential information
Media/Content: Libel, slander and other forms of disparagement as well as copyright infringement by website content
Regulatory Actions: Regulatory actions brought by state or federal agencies to enforce privacy regulations

First-party coverage is commonly available for privacy breach response, which covers expenses incurred by the self-storage facility such as customer notification, credit monitoring, credit and identity repair, and computer and legal forensic services. Policies to address additional cyber liability exposures are becoming more broadly available in the insurance marketplace.

Schedule a meeting with your insurance agent to review your potential exposures and identify possible cyber liability coverage solutions. MiniCo Insurance Agency continues to monitor this area of coverage with the intent to enhance our coverage options in the future.

Mike Schofield
President and CEO

The Risks of Technology: Understanding Cyber Liability was last modified: by

One Reply to “The Risks of Technology: Understanding Cyber Liability”

  1. Robert Chiti

    Great article, Mike. Self storage owners should be very careful not to let website developers add e-commerce systems to their website or mobile apps (i.e. ones that accept and process credit cards) if the solution is not PA-DSS certified. In addition it would also be wise for self storage owners to require (via in the contract they have with the vendor) that the vendor carry both first and most importantly Third Party Cyber Liability insurance. Getting this certification and keeping it updated is expensive, so some vendors are not doing it and it may put an owner’s self storage business at risk.

    Cheers

    Reply

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