Organizations reported 1,061 cyber attacks in 2016. Nonprofit organizations like yours reported nearly 14% of attacks. Cyber criminals have one goal, to gain access to your sensitive information. They don’t focus on organizational size or type, which means no organization, including a nonprofit, is safe from cyber attacks.
There are steps you can take to protect your nonprofit’s data. The best decision you can make for your nonprofit is to add cyber liability insurance to your protection plan. Some nonprofits choose to skip this critical coverage in order to save money, but that mistake can cost you more.
Here are the top reasons you need to buy cyber liability insurance for your nonprofit.
Most nonprofit organizations collect donor information including credit card numbers, social security numbers, and e-mail addresses. If hackers get access to this information and use it in a harmful way, you are responsible for their damages. No other insurance policy will defend your nonprofit or pay for the damages in this circumstance.
Your reputation is arguably one of your best assets. Organizations often end up in the front page headlines when cyber attacks are handled poorly. Most cyber liability insurance policies include coverage to hire a public relations (PR) firm to manage your reputation.
Every state has unique laws on how to handle and notify those impacted by cyber attacks. In most states, you have to notify each individually. The costs associated with researching state laws, notifying individuals, and providing credit score tracking when necessary is extreme. Cyber liability insurance helps to pay for those expenses.
Plenty of nonprofits use third-party websites or cloud-based services for web hosting, data storage, and payment processing. When third-party software is compromised, you are still responsible for your data. Cyber liability policies recognize third-party vendors as a covered software system.
Most general liability insurance policies exclude or provide minimal coverage for cyber breaches. If you don’t have coverage, your nonprofit will need to fund damages associated with a breach on their own. Expenses aren’t cheap according to Forbes; the average cost of a cyber attack is $15.4 million in the United States.
Small nonprofits usually don’t have access to or can’t afford to hire risk managers to design and create a cyber risk plan. But, most cyber liability insurance companies offer policies, procedures, and pre-designed plans at no cost to their customers. Gaining instant access to expert policies and procedures means you have one less thing to worry about.
As a nonprofit organization, you rely heavily on donors to fund your mission and help make a difference in the community you serve. A consistent flow of donations is only possible when your reputation is top-notch. In today’s technology-driven society, you face significant risks to your reputation that you may not be aware of. Cyber-crime is on the rise across the world, and it’s time to protect your nonprofit from the potential consequences.