What Does Cyber Insurance Cover for Small Businesses?

June 18, 2019

Small businesses have many options available in “Cyber Insurance”

Small businesses have several options available under the banner of “Cyber Insurance”. A couple of caveats:

Some insurance carriers allow for coverage to be purchased a la carte, while others sell the coverage as a package.
Scope of coverage and forms vary widely between companies and their programs.
Cheap does not equal better!

From a high level, the coverages can be broken down into the following major and sub categories:

Third Party Coverages (pays for damages to people other than the named insured on the policy)

Costs of hiring an attorney to defend against lawsuits related to a breach of private client information.
Settlements as a result of that breach of private information.
Costs for the defense of client identities.
Costs for the restoration of client identities.
In some cases payment for government fines and penalties.

First Party Coverages (payments to the named insured for damages)

Costs the insured incurs to notify their clients that their information was compromised.
Payment for costs associated with credit monitoring services for customers whose data was breached.
Costs to repair or restore the reputation of the insured
Loss of income the business might incur as they work through the complications of a security breach.
Payment for a cyber extortionist holding the business hostage.

This is not an exhaustive list. There are other potential coverage options available through cyber insurance programs. In addition, they may be labeled/called something slightly different with each plan. Companies who excel at cyber coverage offer the greatest flexibility in fashioning a solution for your business. Deciphering your choices and finding the best value is not an easy or necessarily intuitive effort. How do you find the best cyber insurance solution? Contact a independent insurance agency in your locale that works with businesses as a matter of their focus. Have additional small business insurance questions? We LOVE to help! please feel welcome to call us at 607-382-1235.
This article appeared originally at https://www.quora.com/What-does-cyber-insurance-cover-for-small-businesses

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Auto Rates and Finger Prints: Both are Unique to You!

By Jeff Ryan • April 7, 2026

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