Do Start-Ups Need to Consider Cyber Insurance?

Start-ups have a lot to think about. If you’ve recently taken the plunge to develop your own business, you may be tackling a worldwide pandemic and an uncertain market as well as walking the tightrope of starting a new brand. What new business owners should be aware of is cybercrime. It’s a constant threat that affects users worldwide, small businesses, and enterprise giants – and your budding start-up is not immune to these risks. When you take out commercial insurance in Valatie, NY, consider cyber liability insurance for your start-up.

 

Cyber Insurance for Start-Ups

 

What is cyber insurance?

One of the biggest risks that businesses face today is digital risk. Having an online presence, carrying out transactions, and even just storing data digitally exposes you to cyber risks. If a hacker was to access your website for a few hours or take down your network for a few days, your start-up could be facing significant restoration costs as well as loss of income from your company’s downtime.

Cyber insurance is designed to protect you against digital business interruption, covering the costs of repairing vulnerable systems, and it can provide you with expert advice on how to deal with a security issue. A cyber insurance policy can help to cover both first-party and third-party costs for financial and reputational damage repair if data is lost, damaged, corrupted, or stolen.

 

Why do start-ups need cyber insurance?

When you’re building a new business, your reputation is everything. You want to build a solid client base that creates loyal clients that come back to you time and time again. If you’re beginning to build a book of business, you don’t want your clients’ information to fall into the wrong hands.

If a hacker accessed your digital storage, then your clients’ data would be at risk, and you would be left with the difficult task of letting your clients know your business has been compromised. In an instant, you could lose your clients along with the good reputation you were strategically building.

With cyber liability insurance, you and your clients have a safety net. You have assistance in recovering data and protecting sensitive information.

These days, all businesses should consider taking out a cyber liability insurance policy. Many start-ups mistakenly believe that won’t be targeted until they are more established. However, it is this line of reasoning that encourages hackers to target small and start-up businesses. They know that these business owners haven’t developed cyber security practices, encrypted information, or have insurance in place just yet. As a result, they are more vulnerable to threats and can face significant fallout and devastation in the event it does occur.

 

How much does cyber liability insurance cost?

There are many factors that will impact the cost of cyber insurance. The higher a business’s annual revenue, the more the insurance will cost. If you’re a start-up business, then you can get reasonably affordable coverage. If your start-up works in a sector that is significantly more vulnerable to cybercrime, then you may face higher premiums because of the elevated risk. A good way to show you’re a good candidate for lower premiums is to install security measures, educate employees, and have reactionary policies in place.

Small businesses and start-ups should consider adding a cyber liability insurance policy to their commercial insurance. It is valuable coverage that safeguards your customers and the livelihood of the company. Let us help you find the right business insurance solutions that meet your needs and budget. Talk to the team at Kneller Agency today to get started. We can help you find affordable coverage for your start-up business.

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