Seven commonly overlooked cyber coverages

It is quite common to purchase a package policy that covers a variety of scenarios. Often cyber coverage is added as an endorsement onto another insurance policy. However, it is important to understand exactly what you are covered for, and whether you need to add on extra coverages. You absolutely do not want to file a claim after a critical breach, only to find out you are not covered for that particular exposure.

Listed below are a seven coverages you could add onto your cyber policy in case they are relevant for your business. Speak with your insurance broker to see which of these are relevant for you.

1. Acts and/or omissions of third parties. Almost all companies use multiple external vendors to handle specific tasks (e.g., credit card process, infrastructure hosting). This coverage protects you in the event that a claim arises because of the actions of one of your vendors.

2. Contingent business interruption. When you use third party vendors, you rely on their services to run your business. If their systems are breached and go down, your business may suffer. This coverage protects you in such cases.

3. Data Restoration Costs. First-party cyber policies typically exclude the cost to restore lost or compromised data, which can be significant. If you manage large amounts of sensitive data, consider adding this coverage.

4. Failure to protect data. Most policies cover breaches that happen as a result of unauthorized system access, but may not cover theft or loss. This coverage would protect you in case a lost laptop or USB key results in the release of sensitive data.

5. Regulatory fines and penalties. A significant breach could result in regulatory investigations, fines or penalties. Make sure your policy protects you in such cases.

6. Business interruption coverage. This is an important coverage to help cover the loss of profits or revenue the business suffers as a result of the break. This might be due to systems being down or customers leaving due to reputational damage.

7. Bodily injury and property damage. Cyber policies typically exclude both bodily injury and property damage. This could be an issue if a lawsuit is filed due to emotional distress. For example, the breach of private medical information could result in embarrassment and distress for many individuals.

About Zensurance

Zensurance is Canada’s leading online commercial insurance broker. We offer a full range of insurance products to small businesses, with a particular focus on digitizing businesses and technology startups. We understand what it is to work with new technology, and know the most common risks of which you should be aware. Based on that (and a lot of analytics), we recommend the ideal insurance coverage for your business.

If you have specific questions about your business insurance, please visit us as or email us at and we will find the answers for you.

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