What Is the Difference Between First Party vs. Third Party Cyber Insurance Coverage?
First Party Cyber Liability
covers you and your business in the event of damages, losses or claims arising from personal data.strong>Damage or Loss of Electronic Data: These days, most information is stored in electronic form. This means that the information can be damaged or lost in several ways including by not limited to deletion of incorrect files on accident.
Third Party Cyber Liability
- Loss of Income or Extra Expenses: A technological breach could affect your business in such a way that it cost your business operating costs while the breach is repaired, or business while the systems are down. A Cyber Liability policy makes provision for this damage, and you are able to claim for the damages or losses experienced. Extra expenses, briefly, are things like the costs of recovering the lost data.
- Cyber Extortion: Cyber extortion can happen in several forms, and it can cost your business thousands of dollars – or more. For example, if a hacker held personal information ransom for $250, 000, who would pay for the lost business, the lost time and the necessary investigations? Cyber liability insurance covers losses due to cyber extortion.
- Damage to Your Reputation: Cybercrime can cause a lot of damage to your business and its reputation – this can be internal, or it can turn into a scandal that makes its way to the media and costs you serious business. Damage to your reputation that arises from cybercrime should be covered under your cyber liability insurance policy – and, depending on your individual policy, instances of social media damages could be covered as well.
covers a business from damages that may be claimed by a third-party in the case of a cyber liability loss or claim. Some of the instances that are covered:
- Network Security Liability: In short, network security liability becomes an issue when the security of the network is compromised – and usually anyone else’s security in the process. This will be covered by your cyber liability insurance policy.
- Network Privacy Liability: With network security, it’s just as easy for someone’s privacy to be compromised over a network, and in this case it will also be covered by your cyber liability insurance policy.
- Electronic Media Liability: Electronic media liability covers all forms of electronic media from cyber liability, and while not all policies will have this clause, you should check yours to make sure if it does – ask your insurance provider if you aren’t sure about the details.
- Errors and Omissions Liability: Errors & Omissions cover will insure you if any mistakes, losses or data breaches take place due to the fact that there is an omission or error from one level of the company to another.