Why is Cyber Liability Insurance for Non-Profits Necessary?
As pretty much every business owner knows, if their company has a computer network, or digitally handles confidential information of any kind, they are at risk of a data breach. This is also true for companies that collect and transact with any personal identifiable information. This exposure has the ability to financially devastate a company; a fact that is especially true for non-profits.
In a typical nonprofit organization, administrators usually understand the need for basic insurance policies, such as General Liability, Property Insurance, and even Directors & Officers liability. However it’s important for your non-profit clients to be aware that their cyber liability risks are equal to those of any other company that utilizes computers or digitally stores personal information.
Why do your clients need this coverage? Let’s say that a data breach does occur, and sensitive customer data is lost, such as names, addresses, social security numbers, etc. This opens the door for a lawsuit from the affected third-party. Cyber liability insurance for non-profits provides financial protection against this type of lawsuit. Additionally, this type of coverage can help pay for staff time to re-enter data into a new database, replace hardware that was damaged or destroyed, pay a computer specialist to repair or restore a crashed or stolen file server, pay for staff time to notify all customers or clients to let them know about the breach, and more.
With the right kind of coverage, your non-profit client may be able to transfer the majority of the cost of defending a lawsuit, and should be able to pay the injured party the damages that they allege occurred from the data breach. Data loss is an incident no company wants to face, especially a non-profit. However, being prepared with the right Cyber Liability Insurance for Non-Profits can go a long way in helping your clients recover from a breach.
Understanding the basics of non-profit insurance policies is essential for your clients, as well as for you. At Charity First, we are committed to helping you place coverage for your nonprofit clients. Our mission is to provide coverages tailored to meet the unique needs of this market segment. Please contact us today to learn more at (800) 352-2761.