The world of tech and data security is rapidly changing, leaving many businesses unable to handle the IT demands of operations, infrastructure, and security on their own. As a result, many companies outsource their IT needs to industry experts, but this doesn’t absorb the company from liability issues related to a data breach or other issues of cyber threat.
Addressing the Threat
As businesses are responsible for their client’s online security, third-party cyber liability insurance is recommended by the information on https://www.fgib.com as a form of liability protection. When a client experiences a breach, the resulting lawsuit filed against the company could be covered by the cyber liability policy. A business that could benefit from this coverage include:
- Software developers
- IT consultants or installers
- App developers
- Network servicers
- Security consultants
- Website management
- Website design
While this form of insurance can be purchased as a stand-alone policy, it is sometimes included with a tech’s professional liability plan. The inclusions of coverage often address privacy liability, cyberthreat infringements, and data breaches on account of either its actions or lack of actions.
Differences from First-Party Coverage
If your IT department is outsourced, third party coverage should be enough to address your risks. However, if your business has its own network, you may need first-party cyber liability to protect from any fallout associated with a direct breach to your system.