Why Law Firms Need Cyber Insurance
With the rise of cyber attacks that target core service providers, it's important for legal professionals to consider the risks that come with handling client data.
Law firms rely on sensitive client information, and maintaining the confidentiality of that knowledge is of the utmost importance. With the increasing prevalence of cyber attacks targeted at core service providers, it's important for legal professionals to consider the risks that come with handling client data. For legal practices that lack an engineering team, cyber insurance can be a valuable tool.
Cyber insurance is a type of insurance that provides coverage for financial losses resulting from a ransomware attack or security breach. This can include the theft or loss of sensitive client information, damage to company-owned computer systems and loss of income due to a temporary shutdown of online services.
In 2021, Philadelphia-based law firm Stevens & Lee was targeted in a large-scale cyber attack that exposed the firm’s confidential client information. In the security incident, it was found that the firm’s computer systems had been interfered with as part of a sophisticated data breach. As the event unfolded, it was discovered that the personal information of more than 23,000 people had been compromised.
While insurance is often seen as one layer of protection, the benefits of cyber insurance can cover many of the ripple effects that often occur as a result of a data breach or ransomware attack. Having a cyber insurance policy in place can also provide law offices with coverage for the costs associated with hiring a team of experts who can respond to a security breach, minimizing the damage inflicted upon their business. This can include a forensic team to investigate the attack, credit monitoring services for affected clients, and legal support to help navigate any potential legal issues arising from the breach.
According to Verizon’s 2022 Data Breach Investigations Report, 43% of all cyber attacks are aimed at small businesses. Despite this, only 14% of these businesses are prepared to defend themselves. With cyber insurance, law firms can stay ahead of the curve by providing them with the resources they need to respond appropriately to any attacks that might occur.
Cyber attacks can quickly tarnish a firm’s reputation, scaring off potential customers. Given the fact that a company’s reputation can take years to build, it is in the interest of all law firms to protect themselves before it’s too late. By getting cyber insurance, legal professionals can spend less time worrying about their brand, and more time on giving their clients the representation they need.
The Limit Perspective
Limit is a digitally-native wholesale insurance broker working on behalf of retailers in multiple lines of insurance and across the United States. Our platform allows clients to:
- Obtain instant quotes from top cyber insurers
- Find up to $3M in Insurance coverage automatically
- Receive a plan with customizable and comprehensive coverage
- 24/7 support
Limit is building a lean, tech-enabled business that can efficiently deliver insurance policies which are tailored to the needs of individual clients. We have taken some of the first steps to revolutionizing the industry and welcome you to learn more on our website: www.limit.com
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