Intellectual property is a tricky concept, particularly when it comes to the internet. While finding information is certainly free, reusing or repurposing it often is not. Something as simple as pulling an image from Google Image search and reusing it on your website or marketing material is enough to land you in hot water, legally.
This is why cyber liability insurance is so important, particularly for businesses that are active in creating a digital footprint. But in order to avoid such situations in the first place, you need to be aware of the problems; here we’ll go over some common cyber liabilities, how to prevent them, and what to do if you receive a cease-and-desist from a copyright owner.
What Is Cyber Liability Insurance?
Cyber liability insurance is designed to protect business owners by providing comprehensive data security coverage, breach response services, and claims handling backed by a team of legal, forensic and crisis management experts. It is one of the most significant ways you can protect your business from cyber crime and cyber liabilities in general.
Let’s say, for instance, a restaurant owner promotes an event and accidentally uses licensed images in their promotional materials. The owner of those images sends a cease-and-desist letter to the restaurant owner, demanding compensatory damages as well as the removal of the image from all promotional materials. Such copyright infringement penalties can take a large toll, particularly on small businesses — but cyber liability insurance would cover the cost of damages as well as the costs to defend the claim.
Common Cyber Liabilities
Here are some common liabilities that small businesses face:
1. Data Breach
Did you know that in the year 2020 over 2 trillion data records were compromised, and that in the U.S., the average cost per breach was $3.64 million? While we tend to read about large data breaches in the news, the reality is that the majority of cyber crimes are committed against small businesses. This is because they are viewed as easy pickings for cyber criminals, as they often place less emphasis on cyber security infrastructure.
2. Copyright Infringement
Copyright infringement occurs more often than you’d expect; and it’s often committed unknowingly. In fact, the scenario outlined above, in which a restaurant owner uses a Google Image for promotional purposes, is surprisingly common. The United States Sentencing Commission (USSC) estimates that around 85% of those who commit copyright infringement have no prior criminal history.
In most cases, a simple cease-and-desist letter is enough to solve the problem. However, if you fail to comply with the cease-and-desist, it can be taken to court and have more intense ramifications including hefty fines or even jail time.
3. Ransomware Infections
Ransomware is a type of malware that is designed to block access to particular computer systems or files. The virus keeps those files inaccessible until a sum of money is paid by the victim, hence the name ransomware. Ransomware is actually trending upward, becoming one of the most preferred methods for cybercriminals across the globe.
How to Mitigate Cyber Liabilities
1. Implement Security and Educate Employees
One of the most important parts of running any business is implementing proper cybersecurity programs as well as educating employees on the dangers of phishing scams, identifying suspicious emails and hyperlinks, as well as the various types of viruses and how they work and what to do in the event of a data breach.
Here are just a few of the things your business should have, at a minimum:
- Anti-malware, anti-virus, and anti-spyware software on each computer and device
- Secure WiFi connections
- Virtual Private Network (VPN)
- Keep software updated and update passwords regularly
2. Understand Copyright Laws and Use Royalty-Free Imagery
Be sure to educate all employees on the dangers of copyright infringement when it comes to creating and distributing promotional materials or updating your website. There are many ways to acquire quality images and video clips for marketing purposes either for free or for a relatively low cost. Here are just a few suggestions:
Royalty-Free Photo & Design Tools
3. Get Comprehensive Cyber Liability Insurance
The best way to protect your business from cyber crimes and other internet mishaps is by getting cyber liability insurance.
As a business owner, data security should be one of your top priorities. With the increasing use of credit card payments and digital payments, delivery systems, and mobile and online ordering—where customers are providing their names, emails, credit card info and physical addresses—small businesses are the ideal targets for cybercriminals looking to profit from customers’ personal data and payment information.
Business owners should consider an extra layer of protection by adding cyber liability coverage to their current insurance plan. Get in touch with your local Society agent today to learn more.