8 Questions Regarding Cyber Insurance and Your Business.
Cyber insurance is relatively new in comparison to other business insurance types. It is increasingly being a necessity for many businesses today though. Some industries require it while others simply want it to protect themselves.
You have worked hard to build your business and maintain it. It can only take one unfortunate situation to cost you a significant amount of money or even put you out of business.
With cyber insurance being so new, many companies don’t fully know exactly what it is and if they have a need for it. We have put together a handy questionnaire to help you assess your need for this valuable product.
Ask yourself these 8 questions when determining if cyber insurance is right for you.
1. Do you have employees?
Most breaches come from mistakes made by your employees. You may tell yourself that you wouldn’t make any mistakes that would cause a data breach. The same may not be said for those who work for you.
Even when an employee has the best of intentions, mistakes can be made. Simply opening an email that is suspect could lead to someone accessing your customer’s or vendors information wreaking havoc on maintaining the success of your business.
Also, keep in mind that we are all humans and even us as business owners can make a simple mistake. Oftentimes you don’t even need to make a mistake. You have just experienced bad luck in becoming the target.
2. Does your business have a website?
Your website could be hacked which could cause valuable information getting stolen. You could also face business disruption due to your website being down. Further, you could be at risk of defamation in printed word and copyright and trademark infringements.
You should also make proper considerations to ensure your business website is ADA compliant. Your cyber insurance policy may protect against some of that backlash.
3. Does your business accept credit or debit cards or other mobile friendly payments?
Cyber criminals are most often trying to obtain customer credit card numbers in these data breach situations. This can be especially detrimental if you store any payment information.
In fact, 40% of all cyber crimes come from an attempt to steal client credit card information
4. Does your business use email?
A lot of information is delivered by email and could get into the wrong hands which can come back as a claim against your business.
You could also have someone hack your email and send out phishing emails that could come back on your business.
5. Does your business keep records of customer information?
If you keep records of customer data than you could be at risk of this data being stolen.
That includes but is not limited to the following:
Social Security Numbers
Date of Birth
Drivers License Numbers
Credit Card Info
Bank Account Info
Company Tax ID Numbers
6. Do your employees use personal devices?
Stolen phones, laptops, and tablets could contain valuable customer data that could be detrimental if it got into the wrong hands.
Even if a hacker can’t get into your network, they may have a much easier time getting into your employee’s devices.
7. Does your business have a social media presence?
I don’t have to tell you that we live in very sensitive times. If you or an employee posts a comment on Facebook, Instagram, Next Door, etc, and it is seen as discriminatory or harmful to another person it can be very damaging to your business.
Remember, the intentions of your comments don’t even matter these days. Only how someone received your comments.
8. Do you know exactly how to react if you had a cyber breach?
Let’s say the worst thing happens, and you are a victim of a data breach. There are certain things that need to happen immediately. If you have cyber insurance, the company will immediately go to work to rectify the situation and acting quickly can be the difference between an unfortunate situation and something that may put you out of business.
Let’s discuss some of those common claims paid by cyber insurance companies.
Common Claims Paid by Cyber Insurance
Covering fraudulent funds transfer from your bank.
Reimburse you for lost income from a network or website interruption.
Cover legal fees in suits made against your company from a data breach.
Pays legal fees for slanderous comments made by your company on social media.
I hope this has helped shed some light on the world of cyber insurance and how it can be useful to your business.
If you have any questions or would like a quote on this valuable coverage, please don’t hesitate to reach out to us at 704-494-9495. We directly represent the best companies and the most competitive premiums in the industry. You can also click here for my previous article on this topic.
Getting your trucking insurance policy from a local agent is extremely important. Dealing with a local agency that you can sit face to face with can be very helpful when you are dealing the complications of commercial auto insurance. The trucking industry is complicated. Insurance for commercial trucking is no different.
Commercial trucks can include any of the following types of businesses:
Types of commercial trucks
Dump Truck Insurance
General Freight Hauler Insurance
Auto Hauler Insurance
Public Transportation Insurance
Tow Truck Insurance
Non-Emergency Medical Insurance
If you own a business similar to one of the ones listed above, then you will likely have either a Federal or State of NC requirement to be able to acquire and keep a commercial tag. Even if you don’t have those requirements, then you may have requirements from a contract that requires the same or higher limits as those required by the Federal Motor Carrier Safety Administration (FMCSA) or the state of NC.
What Types of Coverage Do you Need?
This question will vary depending on your business type, the requirements of the State of NC and Federal Government.
Liability Limits: You will have some limit of liability required, depending on several factors. These limits can range from $30,000/60,000/25,000 up to $5,000,000 combined single limits. The amount of coverage required can depend on your vehicle, radius, what you are hauling, gross vehicle weight, and if you are crossing state lines to name a few.
Cargo Liability: This covers the commodity that you are hauling and can vary a great degree depending on the contract requirements and the Federal or State of NC requirements.
Physical Damage: This covers the value of the vehicle you are driving, and the coverage required will depend either on your comfort with losing the value of your vehicle in the event of a loss or the bank requirements of the bank you are financing the vehicle through.
On Hook: This covers the vehicle you are hauling in towing insurance risks. The value of the coverage chosen should be minimally, the highest value of the vehicle you would ever tow.
General Liability: This covers your negligence outside of hitting someone with your vehicle or damage to the items you are hauling.
Umbrella: An umbrella or excess liability policy will cover above and beyond where your underlying policy limits leave off. You want this policy in place to protect yourself further or to satisfy a contract. Many of the bigger contracts will require this policy today.
Workers Compensation: This covers your legal liability for your employees or subcontractors and may even be required by a contract even if you don’t have employees. Even if you hire only one independent contractor, you are obligated by NC law to carry workers compensation.
Commercial truck insurance takes on a whole new level of responsibility than your personal auto insurance. You may want to consider consulting an agent that is near you, to help you with local State of NC laws and help you determine what coverage will best suit you for these requirements. Outside of government responsibilities, you will likely encounter contract requirements that a veteran agent and agency can help you navigate. You will also want an independent agency that can help you get quotes from multiple carriers. Please contact us at 704-494-9495 if you have any questions or would like a shopped quote from the top insurance companies in your industry.
I am often asked to explain what a personal umbrella insurance policy is. Put simply, an umbrella insurance policy is an excess policy that covers you where your underlying limits leave off, at whatever umbrella limit you choose. Umbrella insurance policies give you an extra layer of protection over top of your other personal insurance policies.
This policy is oftentimes purchased as your net worth grows. In our litigious society today, it is very important to protect your assets. Many times it is predatory claimants that will come after you once they find out you have something to lose. Most times though, it is there to protect you against catastrophe situations that may arise, such as major accidents or lawsuits.
What Types of Policies Will My Umbrella Policy Cover?
Most of your personal insurance policies will be covered under your personal umbrella policy. An umbrella policy is what is known as a follow-form policy. A follow-form policy means that if your underlying policy covers you on a claim than your umbrella policy will pick up where that policy left off. Some common insurance policy types include:
Seasonal Home Insurance
Rental Property Insurance
Personal Watercraft Insurance
How Much Does an Umbrella Policy Cost?
Most umbrella policies are quite affordable. In fact, they are probably one of least expensive personal lines policies available. Typically for a household with 2 drivers and 2 vehicles, the premium for an umbrella policy will run around $200 per year or less. The premium is based on several risk factors.
How is an umbrella premium determined?
Some of the most common rating factors for umbrellas are shown below.
Number household of drivers
Number of household vehicles
Age of household drivers
Driving record of household drivers
Number of residences owned by insured
Number of other owned toys such as motorcycles, boats, RV’s, etc
When Should I Purchase an Umbrella Policy?
The short answer is anytime you have a concern of being sued you should buy an umbrella policy. We have some clients that purchase these policies when they are very young and have very little net worth. Others will purchase one as they start to gain some equity in their homes or other assets. Still others will do this when their kids reach driving age and there is a concern that they might be involved in auto accident that might cause them to be sued.
There is no perfect answer for everyone. You have to weigh the costs versus the rewards. With the cost of the premium being so small, there isn’t a lot holding you back from protecting yourself. The chance of having an umbrella claim is significantly less than having a claim on your auto and home policy. However, when you do need to file an umbrella claim, it is typically for a large sum. There are many cases where uninsured people lose everything if they aren’t adequately covered. With the benefits outweighing the costs, most people find that $200 per year is worth the peace of mind.
What Liability Limits Should I Have on My Underlying Policies?
While each company can vary on their minimum underlying limit requirements, the most common minimum limits are shown below by policy type.
Auto Insurance- $250,000 Bodily Injury Per Person, $500,000 Bodily Injury Each Accident
Home Insurance- $300,000
Other cycle or boat insurance policies- Either $300,000 Combined Single Limit or $250,000/$500,000 Split Limits
It is important to understand that if you don’t already carry these minimum limits, you would need to increase them to qualify for an umbrella policy. There will be an increase in premium for the increase in limits as well. Most times the increase in minimal, depending on what your current limits are.
What Else Do I Need To Know About Umbrella Policies?
There are some other important concerns you should be aware of when you have an umbrella policy.
Notify the carrier if anything changes. This includes new cars, drivers, residences, toys, etc. It also includes any new major violations. Most companies will send you a questionnaire at each renewal period to make sure they have the updated information.
Most companies will offer umbrella limits up to $5,000,000. Ask for quotes on each $1,000,000 layer until you hit your comfort level based on premium. Find your sweet spot.
Be prepared for higher rates when household drivers are inexperienced or if you have a driver with a DWI or other major violation.
Your personal umbrella policy will only cover personal lines underlying items. If you have a business and business policies then you should purchase a commercial umbrella policy over those underlying policies. For info on commercial umbrellas or other commercial policies check out one of our previous blogs on the subject.
Ownership matters. Make sure all items are owned by the same named insured. Due to insurable interest, you must make sure all of the underlying policies are also in your name and that the umbrella policy matches that name. Typically this means placing everything in your name and your spouse’s name.
We write umbrella policies through multiple companies. We take all factors into consideration when we shop out these policies. In some cases it is best to have all policies with the same company. In others, the rates are much more affordable to spread them out to multiple carriers. As an independent insurance agency, we put your needs first. Please give a knowledgeable agent a call at 704-494-9495 for a quote or with any other questions you may have regarding umbrella policies.
A contract bond is a type of surety bond that helps guarantee that the terms of a contract are met. If a contractor does not adhere to the terms of the contract than the injured party can collect any financial losses incurred from the bonding company. It is an additional safeguard to ensure the principal performs all items in a written contract.
A contract bond is often times synonymous with the following terms:
Bid Performance Bond
The two common types of contract bonds are bid bonds and performance or payment bonds.
Bid Bonds specifically protect the obligee from the Principal either backing off of the stated bid that has been accepted or submitting a low-ball bid and then not honoring the agreed upon price. Bid bonds are typically issued between 5-10% of the overall bid.
Performance Bonds will protect the obligee in areas of the contract like completing a job when agreed upon and under the agreed upon items. It guarantees that the contractor will perform the contract and pay for the labor and materials needed to complete the project. Payment bonds are typically issued at 100% of the contract amount.
A surety bond is an agreement that involves three of the following parties:
The Principal– The party purchasing the bond that is being required to fulfill the terms of the agreement.
The Obligee– The party that is usually requiring the bond and is reimbursed for financial losses due to the principal’s failure to fulfill the duties of the contract.
The Surety– The party that is responsible for paying out the financial losses of the obligee due to the prinicipal’s failure to fulfill the duties of the contract.
Contract bonds are usually only required on larger projects by large builders or subcontractors. It is a way to easily recover from financial burdens without having to enter into costly lawsuits against the contractor. Typically any public project over $100,000 will require a a contract bond.
A list of common business types that will be required to have these bonds are:
Due to the nature of these bonds and high possible payouts, most companies will run a credit score on the principal before agreeing to issue a bond. In addition to this, some companies may require the following other items to consider a risk.
Financial statements for the business
Personal financial statement for the owner
Resume of owner
Certificates of insurance on other commercial policies the principal may have
Bank letter of reference
Job reference letters
Schedule of current projects on hand
Our agency writes through various bonding companies, as we do insurance companies. Preferred risks will see the best pricing in the industry with a couple of our carriers, but we also have other markets that may not be considered by the preferred companies for one reason or another. Please call us at 704-494-9495 for any questions you may have on this surety bond type or to get a quote today.
Cyber liability insurance is one of the fastest growing insurance policies that NC small businesses are looking to protect themselves with. Because it is such a new policy type, there are several questions on what it is and what it covers. We will discuss exactly those things in this article so that you can make an educated decision if this policy is right for your North Carolina small business.
Everyone knows how much cyber is a growing concern, but it might surprise some businesses just how common it is. It is far from being a concern for only large corporations too. In fact 60% of cyber crimes are against small businesses. 60% of those businesses that are victims of these attacks go out of business within 6 months of the attack. The costs are staggering when they do occur and those without cyber insurance are left with 100% of those costs.
Are you exposed to the possibility of this happening to your business?
If your company has/does have any of the following, then the answer is a resounding yes.
Social Media Accounts (Facebook, Twitter, Instagram, Linked In)
Accept Credit Cards
Uses Online Banking
Store Customer Data (Name, Address, Date of Birth, License Numbers, Credit Card Info, Social Security Numbers)
If you realize that you could be at risk, but are still confused on what types of things could happen to you, then you are not alone. It can be very complicated. We will discuss and clear up some of those common claim types below and explain the ways that a cyber policy will help cover those things.
Social engineering is a predatory type of cyber crime where an employee is tricked into sending or uploading money to someone through false pretenses.
Cyber insurance will cover those lost funds from these types of schemes.
This is a virus sent as a link in an e-mail. Once an employee clicks the link, the virus immediately begins to to encrypt computer files. The imposter will then demand funds in order to recover the company’s files. Typically bit coins will be demanded.
The cyber liability policy will cover the cost of the ransom in order to have your files recovered.
This type of attack gains the most media attention. Large organizations like Sony, Target, and Equifax have recently been in the news for being hacked. These losses occur when a cyber criminal breaches a company network and gains access to customer data.
Cyber policies will typically cover the following:
1. Fines by regulatory commissions and other penalties
2. Legal fees toward lawsuits from customers
3. Security expert assessments
4. Public relations firm services
5. Customer notification costs for those effected by the breach
Covers defamation or slander by an employee about a customer on social medial accounts causing a lawsuit.
Cyber insurance will cover defense in a lawsuit against your company.
FUNDS TRANSFER FRAUD
Hackers gain access to your system and transfer company funds to their account.
Your cyber policy will cover any losses incurred, not covered by your bank for fraudulent transfers.
Your company site gets hacked making your system inoperable and not allowing customers access to their information.
Cyber insurance will cover lawsuits by customers for not being able to access their account.
One final myth we would like to dispel regarding cyber liability insurance, and that is that the premiums are too expensive for a small business. We write through some of the leading insurance companies in the industry, with the most competitive premiums. Premiums start as low as $800 per year depending on the business type, size, and exposure.
Please call us at 704-494-9495 with any questions, or if you would like a quote on this valuable insurance policy today.
We will discuss insurance policies for short term rentals or seasonal homes. This can commonly be referred to as Airbnb insurance, VRBO insurance, or vacation rental insurance.
Short term rental homes are not a new phenomenon, but there has been a large increase in these as of late. This is due largely to the advent of companies like Airbnb, (Airbnb.com) and VRBO (vrbo.com). These companies make the job of leasing your home out a breeze. A lot of people don’t want to turn down the opportunity to make the extra income on their seasonal or secondary homes. If you own a home that you use as a seasonal or vacation home and also rent out, then you should make sure that your insurance policy covers you accordingly.
A lot of people don’t understand that you need to have a specific policy in place to make sure short term rental properties are covered. You need to notify your home insurance company if you move out of your home and lease it to a tenant or have it unoccupied or coverage can be denied. You also need to notify your insurance company of any changes in usage of your secondary home as well.
Most home insurance policies will exclude coverage for business pursuits on your home. This makes your standard home insurance policy inadequate for covering such losses on short term rental properties. Further, if you have a commercial policy in force, but you also use your home as secondary residence for yourself, a commercial policy won’t be sufficient coverage either. This is why you need a specialized policy that acts as sort of a personal and commercial policy hybrid.
Quite frankly, most insurance companies have yet to offer coverage for such a risk. That is just one of the reasons that a large percentage of people do not have proper insurance on their short term rental properties. Another reason is consumer education. Don’t fret though. We have multiple markets that will take on this risk and we are able to close the knowledge gap on this topic.
There are many properties that can constitute a short-term rental policy. Some of the more common types are listed below.
Common Seasonal Homes and Short Term Rental Types
Beach house or condo
Mountain house or cabin
Golf course house or condo
What coverage types should you focus on when getting a policy? There are several endorsements that should be considered. The 4 most important types coverages for short term rentals are the following:
The dwelling is the structure you want to cover. For your home or condo to be covered it is important to make known the use of the building. Like your primary home insurance, this will cover things like fire, water losses, falling objects, lightening, wind, etc. If you use it as a vacation home and a temporary rental, this should be disclosed to your agent. Insurance companies may deny coverage even on these losses if they discover you are renting your house out, even on a short-term basis.
In many cases you can also cover detatched structures such as sheds, barns, guest houses, and garages. You want to make sure to tell your agent about these to make sure they are listed on your policy. Some policies will cover up to 10% of the primary dwelling amount. Some, but not all. You may also find that these detached structures need to be covered for more than this amount.
CONTENTS OR PERSONAL PROPERTY
These items include clothing, appliances, furniture, lawn care items, etc. It is highly recommended that you add a replacement cost endorsement to your policy so these items can be replaced instead of just receiving the depreciated actual value of them today if there is a claim. That way if you had a fire loss, you could truly replace everything with like items that are brand new.
This might be the most important coverage type. If you are leasing out your home and you are sued for negligence of any kind, your liability coverage will protect you. Keep in mind you don’t even have to be at fault to get sued. Lengthy court battles can get expensive and your liability will cover these expenses. They will also cover settlements if the courts rule in favor of the plaintiff.
Do yourself a favor and choose the highest liability limit the company will offer. The cost differential is not that much and the reward for having the higher limits can be huge. Many companies will offer a limit up to $1,000,000 for liability.
Sometimes referred to as loss of use coverage, business income covers expenses you would incur by not being able to rent a property due to a covered loss. For example, if you had a fire and the home had to be renovated or replaced, your business income coverage would pay for loss of rental income during this time of reconstruction. This is not always standard so be sure to ask for this if you want the coverage.
Two final recommendations.
If you plan to rent out a property of any kind, you may want to consider transferring that property into a business name or LLC. This will further protect you from anyone being able to access any of your assets in your personal name. Just make certain your insurance policy is in the same name as the property owner.
Consider an umbrella policy that will pick up where your underlying property policy leaves off. Again, make sure you have the correct name listed as named insured on this policy as well.
For any questions on anything discussed please feel free to give us a call at 704-494-9495. Our agents can help explain these matters to you and get you a free quote on this coverage.