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Who Benefits from Cyber Liability Insurance


The benefits of cyber liability insurance are not confined to any particular industry or business size. While it is true that some industries or companies are more vulnerable to data breaches, primarily because they maintain larger volumes of the type of data that is valuable to a hacker, any business or institution can find itself in a hacker’s cross hairs.

Healthcare Organizations

Companies in the healthcare industry are among the most frequent target of cyberattacks. More medical records are stored electronically and more internet-connected (“IoT”) medical devices are coming online, all at the same time as regulatory authorities are more vigilant about imposing fines for HIPAA violations. The benefits of cyber liability insurance for healthcare organizations far outweigh these heightened risks and exposures.


After healthcare organizations, companies in the retailing industry are the next most-exposed targets for cyberattacks. Newsworthy cyberattacks on large retailers like Target and Home Depot have eclipsed the equal or greater risks faced by small to midsized retailers, all of which maintain personal and financial electronic customer records.  Any retailer that loses control over those records will face customer lawsuits and expenses that can wipe out one or more years of profitability. Specialty retailers that have only one or two locations can benefit most from cyber liability insurance protections which, in many cases, can be the difference between staying in business and filing for bankruptcy.

Small and Midsize Businesses (SMBs)

The cyberattack that compromised the records of Target’s customer base was traced back to the weak cybersecurity environment maintained by one of its vendors. In view of events like this and the exposures that they create for large companies, those companies are more likely to do business with vendors that maintain stronger cybersecurity environments, including cyber liability insurance to reimburse the large company’s losses when a data breach does occur. Insurance can help to support and maintain and SMBs reputation and its relationship with its big-name customers.


Accountants are stereotypically organized and logical in their recommendations to their clients. That same organization and logic more than justifies cyber liability insurance for their own operations. An uninsured CPA firm that experiences a ransomware attack, for example, will likely lose more revenue as a result of the time it needs to recover from the attack than it pays out in ransom to unlock its frozen data and systems. Like other service firms and consultants that rely on their time and professional reputations for profitability, accountants benefit from cyber liability insurance by using insurance payouts to compensate for lost time and associated reputational damage.


Almost 40 percent of all recorded data breaches in 2016 targeted companies that had some volume of eCommerce business. Those business can improve the security of their online operations by using more secure eCommerce platforms and secure connections for online checkouts, but they cannot eliminate every potential hacking threat. Cyber liability insurance is the last line of defense against the threats to eCommerce companies that cannot be prevented.

Educational Institutions

Universities in the United States and throughout the world are ripe data breach targets.  Their open networks, often free public access, and huge data volumes combine to make them tempting targets for hackers, leaving those institutions prone to reputational, operational, and financial damages. Cyber liability insurance can stem the tide of these damages when a cyberattack does break through an educational institution’s defenses.

Government and Public-Sector Entities

Government institutions store copious amounts of constituent data, often on older legacy systems that are far more susceptible to cyberattacks than modern systems and networks. Government agencies may not always be amenable to cyber liability insurance, but they can still adopt the insurance mindset of managing risk rather than attempting to eliminate it by all means possible. For all businesses and institutions, cyber liability insurance is one of the most important tools in the arsenal of components that go into cybersecurity risk management.

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