It’s not possible to insure against the risk trolls will try to damage your business online before it opens. But there is a number of limited circumstances in which insurance can help repair a damaged commercial reputation.
Michael White is Steadfast Group’s technical manager. He explains some management liability and professional liability policies will help, subject to the terms of the policy, pay for the cost of public relations services to repair reputational damage.
“Let’s say a restaurant patron falls ill after dining at the establishment and subsequently unfairly criticises the restaurant throughout social media. If the restaurant has the right cover, the policy may cover a policy for the costs of a public relations or crisis management firm to repair the damage done to the restaurant’s reputation as a result of the incident,” White explains.
Cyber insurance may also provide cover to repair the policyholder’s reputation should the business receive adverse publicity in the aftermath of an attack. For instance, let’s say a hacker compromises a medical centre’s IT system, steals its patients’ data and sells this information on the dark web. The media finds out and runs a story about the theft, which results in many patients leaving the practice, leading to an economic loss. If the business has the correct type of cyber cover, the policy should pay for a PR firm to roll out a strategy to repair the medical centre’s reputation .
In another example, cyber criminals infiltrated a financial services firm’s network and stole its customer’s personal information. The business did have cyber cover, which paid for its system to be reinstated. But the damage to its good standing had been done.
“Certain types of cyber policy can cover the economic loss the client suffers as a result ”
“Even though they were able to get the IT system up and running again, the business lost clients whose confidence in it was damaged because of this incident, which was widely covered in the press,” White explains.
“But because it had taken out comprehensive cyber cover, it was able to use funds from the claim to invest in employing a public relations expert to restore its reputation,” he adds.
Certain types of cyber policy can cover the economic loss the client suffers as a result of damage to their reputation as a result of a cyberattack.
It’s easy to assume your business’s reputation won’t suffer in the event of a cyberattack or another crisis that calls into question customers’ faith in your operations. But as these examples show, a company’s good standing can be destroyed overnight, especially if its customers’ personal information is compromised.
Cyberattacks are on the rise – every minute the Australian Cyber Security Centre receives a report of a new attack – so now’s the time to talk to your Steadfast broker about your cover and the protection it provides not just for operational damage of a cyberattack, but also for the ensuing reputational fallout that all too often means the death of a business.
Important notice - Steadfast Group Limited ABN 98 073 659 677 and Steadfast Network Brokers
This article provides information rather than financial product or other advice. The content of this article, including any information contained in it, has been prepared without taking into account your objectives, financial situation or needs. You should consider the appropriateness of the information, taking these matters into account, before you act on any information. In particular, you should review the product disclosure statement for any product that the information relates to it before acquiring the product.
Information is current as at the date the article is written as specified within it but is subject to change. Steadfast Group Ltd and Steadfast Network Brokers make no representation as to the accuracy or completeness of the information. Various third parties have contributed to the production of this content. All information is subject to copyright and may not be reproduced without the prior written consent of Steadfast Group Limited.