With the emergence of social media, utilizing cloud companies as vendors, and the use of the internet in general for virtually every business, network security claims have become a reality for all types of companies—small, medium, and large. Network security liability, commonly known as cyber liability, is becoming a more necessary and important part of any organization’s liability coverage. Just ask Sony.
Who needs this coverage? Any business managing sensitive customer or employee information, third-party corporate information, a computer network, a website, or social media should consider network security liability coverage.
Review governmental policies relating to your client’s industry. There are many national guidelines for how personal information is gathered, stored and shared for U.S. citizens. Depending on the industry your client is in, different governmental regulations may apply. For example, in health-related fields, clients must be aware and compliant with patient protection guidelines according to the Health Insurance Portability and Accountability Act (HIPAA) of 1996. Also, review the state policies for your client. In some states, it is required that companies notify customers if their personal information will be made available or has potentially been gained access to by anyone outside the company.