Doing business in the 21st century is both easier and more complicated that it used to be. Unfortunately, the employees and tools that help you serve your clients may also be the downfall of your business. Your hard work can be wiped out in the blink of an eye by the expenses of recovering from a data breach, or if you must defend yourself from a lawsuit brought against you by an employee.
At L & M Insurance Group, we think you should consider the following two types of liability coverage, in addition to a standard Business Owners Policy (BOP), if you’re a small business owner.
Cyber Liability Insurance
Many small businesses are not even aware that they are at risk for attack, believing cyber criminals are more likely to target large companies. Unfortunately, small businesses are more and more frequently the target of cyber attacks—for example, not long ago one small accounting firm in our area had to spend many hours and dollars recovering from having a hacker breach their system and access clients’ personal information.
Any business that collects and stores sensitive personal information is at risk. If your business handles or stores customer information such as credit card numbers, Social Security numbers, and even addresses, you should carry cyber liability insurance.
It can cost your business thousands of dollars to recover from a data breach. You’ll face expenses related to investigating the crime, communicating the breach to your customers (which is required by law in most states), legal and public relations expenses, and costs you incur due to interruption of your business while you sort things out.
Cyber liability insurance protects both you and your customers from financial losses related to a data breach. It covers a range of threats, including hacking, network failures, or a breach related to the loss or theft of an employee’s laptop or smart phone.
Insurance companies have been working to make this coverage more affordable, as well as suit the needs of businesses of all sizes.
Employment Practices Liability Insurance
Another type of liability coverage you should consider buying is Employment Practices Liability Insurance (EPLI). This coverage protects your business from lawsuits brought by employees claiming discrimination, sexual harassment, wrongful discipline, wrongful termination, retaliation, and so on.
Small businesses can be especially vulnerable to these claims because, unlike large corporations, they may not have an employee handbook or a legal department spelling out what procedures to follow when hiring, disciplining, promoting, and firing employees. You can be sued even if you’ve done nothing wrong!
Most EPLI covers legal costs (whether or not you win the lawsuit), judgments, and settlements. Most policies cover the business itself, officers and directors, management, and employees.
For your protection, please consider adding these two types of liability coverage to your insurance plan, either by endorsement or by purchasing stand-alone coverage.
At L & M Insurance Group, we understand the challenges of small business because we’re a small business ourselves. Please call one of our trained agents at 813-672-4100 to discuss your small business insurance requirements, or contact us by email. As independent agents, we can tailor your insurance coverage to fit your specific needs.
