Insurance

Do you need a personal cyber insurance policy? How to be safe online?

As people spend more and more time working online, the threat of cyberattacks increases. Many insurers now offer personal cyber insurance to minimize financial damage in the event of a hack.

A recent email from my bank offered me something I had never seen before; cyber insurance. “Cyberattacks Are On The Rise,” the headline reads, “Are You Protected?”

This piqued my curiosity because although most of us are aware that we are vulnerable to cybercrime, we already know the steps we can take to protect ourselves. We use strong passwords, two-factor authentication, and try to avoid phishing scams. So I wondered if this type of insurance would be necessary for me.

Personal cyber insurance can cover expenses related to identity theft, fraud, ransomware, and even cyberbullying. My bank offered policies with coverage ranging from $10,000 to $50,000. The cheapest policy would cost just over $5.00 per month. Customers would not need to pay a deductible for identity theft, but would have a $250 deductible for other coverages. Some insurance companies offer this protection, often on top of a home insurance policy and offer even higher coverage options.

A cyber insurance policy can cover a wide variety of online crimes, including paying a ransom in case someone hacks and takes over your computer and demands money to free it. It can cover fraudulent charges on a checking account by accessing it online or via a debit card. Coverage can also pay for legal fees and lost income if a stranger damages your reputation by posting false or personal information online. This could cover your losses if you send money to someone as part of a phishing scam or in case a criminal steals your identity. The police can also pay for mental health services if someone is bullying you or your child and can even cover relocation costs if needed.

Should you consider a cyber insurance policy?

It will take an assessment of your online habits to decide whether or not you should invest in a cyber insurance policy. Be honest with yourself about what you are doing to minimize your risk of a cyberattack. If you participate in best practices for protecting your information online, a cyber insurance policy may not be necessary. But if you, or a loved one, are frequent victims of phishing scams, identity theft, or have a public profile that could be attacked, you might consider purchasing coverage.

Although I’ve never had my identity stolen, a burglar recently got hold of some of my credit cards. None of the credit card companies held me responsible for the fraudulent charges. And you might want to check your landlord’s insurance policy. Some of them cover certain types of fraud which can include crimes like identity theft and phishing scams.

Whether or not you decide to purchase personal cyber insurance, you can reduce the risk of any cyberattack by taking preventive measures.

Do both steps

Two-factor authentication adds an extra step when logging into certain websites to make sure it’s really you. Sometimes the website will text your phone a code, ask a security question, or ask for fingerprint identification. It’s not a lot to ask to verify that the right person is logging into a website with sensitive information like a bank account or a school portal.

Boost your passwords

Birthdays, pet names, and your favorite sports teams aren’t strong passwords, even if you put the number one and an exclamation point at the end. Each password should be long, unique and complicated. Most devices now help you with their own password managers, so use them. Some of these password managers are great for letting you know when you’ve duplicated a password (a big no-no) or when a hacker has been compromised.

Be careful before you click

Phishing scams can come from emails or text messages and usually encourage you to click on a link. Maybe you’ve seen some of the popular types that are doing the rounds, such as “Your Netflix account has been frozen” or “Please log in to your gmail account and update your password”. If you click, malware may be downloaded to your computer, or you may be taken to a website that looks legitimate but only exists to steal your information. Better to enter the address of the known website instead of clicking on a link.

Don’t wait to update

Hackers often break into your digital life through software flaws. Making sure all devices and apps have the latest software updates can help. If you see the option for automatic software updates, enable them.

Taking every precaution still can’t guarantee that you won’t fall victim to a cyberattack, but it might be enough to avoid having to take out insurance against it.