Cybercrime has risen to a serious threat level over the last few years. In spite of the advancements in tech and software to help prevent data breaches and protect personal privacy, the hackers and members of the dark web have grown equally sophisticated and updated in their hacking attacks. There are increasing reports about financial intuitions, such as credit card companies, and social networking agencies that have left their customer’s data unprotected. When it comes to who is responsible for the attacks, there is some concern with who needs to claim liability. In these instances, it is important to understand the first party vs third party cyber insurance.
For those in businesses that have little to do with technology, first-party insurance is usually adequate. This coverage applies to everyday risks associated with data breaches. With the support of the policy, the company is able to financially able to notify those affected, provide credit monitoring, recoup lost data, establish records management, and manage brand damage.
For the companies and individual that provide or operate the tech systems which allowed the cyberattack to occur, a third-party cyber liability policy is needed. According to the team at Financial Guaranty Insurance Brokers, Inc., these plans are usually marketed towards software firms, independent contractors managing the networks, and tech startups. If you are in IT, you will want to secure both types of coverage, given the unique exposure on both sides.