Do You Need Cybersecurity Insurance for Your Firm?

Financial and business chart and graphs concept

Financial and business chart and graphs concept

Cybersecurity is becoming an important factor in running a law firm these days. Many courtrooms all over the country use electronic systems to file forms and to document proceedings. For the attorney, having your own system can be necessary not only to navigate the courts, but to handle the copious amounts of data you’ve gathered for a particular case. This information can often be sensitive in nature, and it can be valuable to your clients. This is why malware, ransomware and data beaches can be so crippling to any law firm, but a new measure of protection has appeared on the market—cybersecurity insurance. However, does your firm need such protections?

Why Would a Law Firm Need Cybersecurity Insurance?

In the event of data loss, your law firm could be on the hook for many expenses. These costs can include recovery charges, new equipment and software to replace the systems that failed, and clients may even insist on compensation for any delays or data loss that may have occurred. This turns cybersecurity issues into a paramount concern, and that’s where cybersecurity insurance comes into play.

These new policies offer coverage for bodily injury, business interruptions, property damage and other liabilities that result from data breaches. These insurers even offer discounts based upon the security measures businesses have in place. Allianz, a cybersecurity insurance firm, is offering lower rates and deductibles to clients who use products from Apple and Cisco. This is due to the higher security standards put into place by these manufacturers, but there may be other reasons for these discounts.

Business Essential VS Marketing Scheme…

Publicly announcing such discounts could affect market shares, driving more businesses to buy systems that will get them discounts with an insurer. These efforts and protections are also post-cyberattack measures, which begs the question, what will these insurers do to prevent data loss from cybersecurity threats? Some insurers offer retroactive coverage at a premium while others offer to put you in contact with security services they have alliances with.

Often, these types of insurance programs can boil down to marketing and business alliances. If you have competent and reliable internet security providers working on your systems, you may not need cybersecurity insurance at all. Some companies that handle cybersecurity already have insurance in place to protect their clients.

At this point, cybersecurity insurance is an extra security blanket for those firms that wish to undertake it, but it is not required, and you may never need to use it. Like most insurances that aren’t required by law, you will have to evaluate if the cost is worth the protection, and for many smaller firms, such an expense may not be an option. Considering the technology services provided by the IT professionals at Exactify.IT, we will continue monitoring this emerging market to see what values it can provide for our clients and other law firms.


Posted In: All posts

Posted On: February 26, 2018

Posted By: Exactify.IT

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