Why Cyber Liability Insurance is Important for CPA Firms - Cyber Liability Insurance NJ

Cyber Liability Insurance NJ - CPA Liability Insurance NJ

Did you know nine million Americans are the victims of identity theft each year, resulting in losses of more than $15 billion? Identity theft is just one component of a larger concern: cyber attacks and security breaches. That’s why cyber liability insurance is now offered through many insurance companies as add-on coverage. Certain professions, such as CPAs, need extra protection in the event a cyber attack occurs, prompting the need for a policy custom tailored to your situation. This type of policy will protect your firm throughout the investigation and throughout any lawsuits brought against you by clients who may have had their private information stolen.

This relatively new offering can protect a company’s personal data in the event a security breach occurs. You need this extra coverage in addition to your general liability policy in order to be covered in the event your website is hacked. That’s because general liability policies don’t cover losses caused by cyber hacking and other Internet-based crimes. Cyber liability policies are available to bridge those gaps in coverage.

CPA Liability Insurance - Why You Need It

CPAs in general are bigger targets for cyber attacks than other types of businesses, because they handle large amounts of money and confidential information on a daily basis for clients of all sizes. If hacked, you as a CPA could face a devastating financial blow due to a security breach and impending investigation. You will likely lose money, time and reputation as you deal with the investigation and aftermath. In addition to that, you may face lawsuits brought against you by clients whose personal information, such as account numbers and social security numbers, have been compromised.

There are two types of cyber liability insurance: first-party and third-party insurance. First party will cover only your company for loss of data, income or damages resulting from a cyber attack or data breach. Third party will extend to insure your clients, with coverage for:

• Responses in relation to governmental inquiries
• Payment fines and penalties
• Notification of clients and victims
• Civil lawsuits
• Credit monitoring services for affected clients
• Public relations expenses to protect your reputation and standing in the community

Think about whether or not you have the resources to battle the court system, hire an attorney and survive the damage to your reputation if a security breach were to happen TODAY. It’s likely you do not, no matter how large or small your firm is. Getting cyber liability insurance will protect you against those losses and save you from financial ruin. Just be sure to inquire about exclusions such as data breaches that occur in-house, Acts and Omissions insurance, and/or retroactive coverage for breaches that have already happened but haven’t been discovered yet. You can ask all these questions and more when you sit down with your insurance company to purchase cyber liability insurance for CPAs.

Call the Professionals at The Kerr Agency

Don’t know where to turn? Contact us at The Kerr Agency for advice and a custom crafted cyber liability insurance policies designed specifically for you as a CPA. We’ve got you covered.