Digital technology streamlines the operations of your volleyball club, but it also means that everyday activities ranging from the collection of information and website usage to promotions on social media can leave you open to cyber risks. While a strong line of defense is your best protection against cyberattacks, it may not be enough.

Cyber liability insurance is a special type of insurance designed to help businesses bounce back from the financial impact of a cyber threat or data breach. Like other insurance policies, cyber insurance is a layer of protection you hope you won’t have to use. However, it can substantially reduce the impact of a cybersecurity event if one does occur.

The Value of Cyber Insurance

The average cost of a data breach is $4.88 million, a number that most successful businesses can’t easily recover from. Yet, the actions of a hacker – like stealing the PII of your players or introducing a virus to your system – aren’t covered by general liability insurance or D&O policies.

Cyber insurance is a specialized type of insurance that provides coverage based on an organization’s potential data exposures. It helps you recover from the financial damage related to a cyber incident and obtaining the right level of coverage can help you save millions.

5 THINGS TO LOOK FOR IN CYBER INSURANCE COVERAGE

Cyber insurance offerings differ between carriers and the needs of an organization. When choosing a policy, it’s essential to ensure you have ample coverage to protect against the threats most likely to target your club.

This checklist can help you find everything you need in a cyber insurance policy.

First-Party Coverage

This type of coverage provides financial protection for direct losses related to a cyber incident.

  • Response costs: Forensic investigation, restoring damaged systems, and notifying affected individuals
  • Legal costs: Legal counsel to assist with inherent regulatory obligations
  • Data recovery costs: Recovery and replacement of data lost during a breach
  • Business interruption losses: Financial compensation for lost income from downtime
  • Crisis management costs: Public relations to address the public and avoid reputational damage
  • Regulatory fines: Fees or regulatory fines related to the incident
  • Extortion costs: Experts to evaluate recovery options and negotiate ransom payment demands
Third-Party Coverage

Third-party losses are related to the costs you’ll incur due to the impact of the breach on affected individuals and any lawsuits related to the incident.

  • Data privacy liability: Assists with costs related to third parties who had information compromised (including lawsuits, settlements, or credit watch services)
  • Regulatory defense: Helps cover defense-related costs including fines and defense costs related to regulatory actions or privacy law violations
  • Multimedia liability: Takes care of payments related to defamation, libel, slander, and negligence allegations
Extortion & Ransomware Coverage

If cyber extortion and ransomware coverage are not included in your first-party coverage, it’s essential to purchase additional coverage for these events. Unfortunately, ransomware is easy for experienced hackers to deploy and leads to some of the most costly and destructive cyber risks for any organization. Seek cyber extortion coverage that provides financial coverage for ransom costs and coverage for physical damage (to computer systems and other hardware) caused by cyber incidents.

Coverage for Attacks Against Vendors

You may not think supply chain risks are a concern for a volleyball league. Yet, you depend on suppliers for data storage, websites, payment transfers, etc. If the vendors you work with don’t have adequate protection against cyber threats, your data could be at risk. Ask how your cyber insurance policy can cover cyberattacks on your data held by vendors and third-party companies.

Retroactive Coverage

Cyberattacks are often successful because they’re carried out discreetly. It takes organizations an average of 204 days to identify a cyber breach and another 73 days to contain it. This means your system could be under attack for months without you knowing about it. Retroactive coverage helps protect against unknown incidents that have already occurred. If your data was compromised during a certain time before you obtained insurance, retroactive coverage may still provide protection for issues that arise from the breach.

Now that you understand the value of cyber insurance and what to look for in a policy, it’s time to find a reputable insurance provider to supply you with comprehensive protection against cyber threats. While we hope you’ll never need it, cyber insurance is an essential layer of protection for any organization with a digital footprint.

CLOSING THE BLOCK: CYBERSECURITY HOT TIP

Know what to look for in a carrier!
Cyber insurance policies vary from one carrier to the next. Before comparing insurance policies, seek carriers with these essential qualifications.

  • A strong reputation for providing cyber insurance to sports leagues and organizations responsible for the PII of minors
  • The financial security to help you recover from a cyber incident if one occurs
  • A clear description of how they’ll handle your claim
  • Positive customer reviews that share information about how the provider treats their customers
  • Provides information and resources to help you identify current cyber risks and limit vulnerability to attacks

View more technology related education here.

About the Author
Brad Preston is a client advisor at World Insurance Associates (World) specializing in the Sports industry. Prior to World, he spent more than 20 years at Advanced Event Systems and SportsEngine where he worked closely with the JVA and other member clubs in the volleyball space. He is well versed in club operations, staff, and member management, and most importantly, the use of technology and its inherent cyber risks. The JVA and World have partnered together to bring JVA Members educational articles and content to help you learn about your unique cyber risks and exposures, and how to better protect your businesses, members, and families in general. Feel free to reach out to Brad directly with any questions at bradpreston@worldinsurance.com