There are big differences in scope, kind and flexibility of breach response services between available cyber coverages, so many options are available for clients to consider.
â€¨Sometimes in the aftermath of a data breach, clients blame their agent or broker for failing to obtain coverage that expressly would have responded to a data breach or other cyber exposure. These situations often are avoided through routine communications that confirm in writing that you and the client discussed cyber exposures, and specify the actions taken as a result of the discussion. By asking clients to let you know if they want you to take any other or different action in connection with their cyber exposure, and keeping a paper copy of the communication, you will be prepared to refresh recollections if needed.
â€¨The best way to avoid data security problems is to take reasonable measures to protect sensitive information, whether that information is kept in paper or electronic form. Remember that the Internet is not a private form of communication. It’s more like an old-fashioned party line telephone: you never know who is “listening in” and reviewing the content of your e-mails and other electronic documents.
â€¨It is shockingly easy for cyber criminals to obtain sensitive information from unprotected e-mail communication, particularly when the communication is wireless and made in a public location. Laptops and other portable devices also are easy targets for thieves. Businesses and individuals should take simple, commercially available steps to secure sensitive data. The steps to take depend on a number of factors, including the size of your operation and the kind and amount of sensitive data that you transmit. Password protections and key fob tokens frequently are used. Some operations prohibit storage of sensitive data on USB drives (also known as stick-or thumb-drives). Other operations have returned to â€¨communicating sensitive data by telephone rather than transmitting via unencrypted e-mail.
Prudent businesses should supplement their reasonable security measures by purchasing cyber coverage, just as prudent businesses purchase property insurance to supplement their building security measures.
Just as property insurance protects businesses from fire losses and often leads the way in improving building safety, cyber insurance protects businesses from data breach losses and encourages best practices by charging smaller premiums for businesses with better data security.
Lori can be reached at email@example.com