3 Ways to Know if Your Firm Needs Cyber Insurance

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Small accounting firms rarely consider advanced insurance protection and instead opt for standard insurance like errors and omissions, general liability, workers’ compensation and property and contents, assuming anything more advanced is optional.

But as your business expands, it becomes more and more important to think about how you would serve your growing clients base if the worst were to happen. And in a modern technology landscape, the worst often involves a digital threat to the most important asset your accounting firm has: your data and that of your clients.

Cyber insurance, also known as cyber liability insurance coverage or cyber risk insurance, helps offset costs involved with recovering from a cyber attack or security breach. It of course doesn’t prevent cyber attacks, but it can significantly offset the risk of a breach by underwriting reimbursable expenses like:

  • Investigation
  • privacy notifications
  • lawsuits and extortion
  • business losses from network downtime
  • data loss recover
  • crisis management

Cyber insurance first appeared on the market in the late 1990s and early 2000s. However, it’s only in the past few years that it’s become a common insurance policy for businesses that collect and store data.

Roughly 33 percent of companies in the United States purchase some type of cyber insurance. In fact, cyber insurance is quickly becoming a default insurance option for companies that store any kind of data online.

Curious about whether or not your firm needs cyber insurance? Here’s a look at three reasons more accountants, tax preparers and bookkeepers than ever are considering this coverage:

1. Cyber attacks are on the rise

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About Tomas Suros

Tomas Suros

Tomas Suros is a lawyer and technology advocate working at the intersection of law, IT, and client consulting. With AbacusNext since 2004, he currently serves as Chief Solutions Architect, guiding firms through the process of identifying forward facing technology options and ensuring the successful implementation of a tailored solution.

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Jul 31st 2018 20:01

It was very useful post keep sharing. Thanks for expressing this concept in such simple words . All these tips are really important to know. they are valuable and simple to understand. keep up your work. also visit my blog which help to understand the financial terms in a simple way

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By lunna
Aug 1st 2018 11:31

Nonetheless, the posts are very quick for beginners. Could you please lengthen them a bit from subsequent time? Thanks for the post.

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to lunna
Aug 1st 2018 14:33

All of our posts are meant to be "consumable" as they are not detailed reports but rather smart facts and tips to provide direction and confidence to practicing accounting professionals. We do often have more detailed, downloadable guides, usually located in our Resources section. https://www.accountingweb.com/more/resources

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