Cyber Crime. Today’s Reality.

Following HIPAA High Tech legislation and recognizing the seriousness of cyber liability and cyber crime, states are now starting to require some healthcare providers to purchase cyber liability insurance. For example, Illinois and Michigan require non-profit healthcare providers who benefit from state funding to buy cyber liability coverage with a minimum $1,000,000 limit. It appears that very soon states will treat the purchase of cyber liability insurance just like auto insurance with mandatory purchase and mandatory limits.

For YOUR peace of mind, Preferra Insurance Company proactively started to study cyber insurance risk in 2012 and in July 2014 began to introduce a line of cyber liability solutions that will help to protect YOU. We offer a low cost cyber liability insurance policy that is guaranteed to be issued to NASW members and fits the budget conscious social worker who still wants some coverage for all of the major cyber liability perils noted below in this article. We are working on additional insurance coverage that contributes to the replacement costs arising from the theft of computer and telephone devices that hold proprietary information, including patient telephone numbers, along with some patient data breach related protection. The Professional Liability insurance policy does cover the insured for certain equipment losses in the event of a first party assault which is a differential advantage in the insurance marketplace.

In September 2014, Preferra Insurance Company partnered with Great American Insurance Company, founded in 1874, with an A.M. Best rating of A+ (Superior), traded on the NYSE as symbol “AFG”; to launch a super-charged multi-tiered comprehensive line of Cyber Liability insurance for individuals and agencies starting at about the price of a car insurance policy. This Cyber Liability insurance is also offered to any size agency practice, including non-profit or for-profit.

Coverage from all of these cyber liability programs is usually issued the same day that you apply. Call Preferra Insurance Company now, or check the website for more information.

Your practice may be wiped out if you are an uninsured victim of cyber breach or even a paper records breach. Your third party vendor or mover of your records almost always includes an indemnification in its contract with you that holds them harmless, so you take the responsibility and you pay all of the liability costs arising from any records information breach.

Insurance industry information indicates that on average, a record breach, whether it be paper or digital, costs $200 per client in the practice. So, if you have 1,000 clients and one records information breach occurs, you face on average, $200,000 in costs. These costs are typically split one-third for notification and damage control, and two-thirds to loss of clients and rebuilding systems.

Does your practice or agency accept credit cards? This is just one of many payment card breaches that cyber liability insurance protects you from.

Here are the key cyber liability perils:

• Notification expenses to third-parties associated with data breach that may be required by state law, GLB, or HIPAA;
• Costs incurred by the company or practice in investigating the breach or security incident that caused the problem, including potential costs for forensic investigations by outside professionals (What happened? How did it happen?);
• Costs associated with data restoration if the security breach resulted in electronic data loss, including applications and data bases;
• Potential costs to protect individuals and patients whose information was compromised for credit monitoring;
• Fines and regulatory actions that are the direct result of the system breach;
• Costs or losses associated with business interruption; and
• Content and advertising injury associated with electronic media.

Contact Preferra Insurance Company now to secure your practice 888-278-0038.

*Great American Insurance Company was founded in 1874, trades on the NYSE as symbol “AFG”; and has an A.M. Best rating of A+ (Superior).

Published January 2015