What is Data Breach Insurance?
Gallagher Healthcare :: Industry InsightsBy Gallagher Healthcare | 7/12/2018
Medical professionals rely on computers to store patient data, to communicate with other physicians and to research. As more of the medical field becomes digitized, concerns about cyber security and data breaches grow. Patients are becoming more sensitive to the dangers of data breaches, in part due to some high-profile consumer data breaches in other fields. In addition, fraudsters actively use the personal information they obtain through hacking for identity theft, meaning those affected by data breaches often seek to recover damages for lost money.
Digitizing your records can actually help you improve the safety of your records, since online records can be password-protected and less likely to be stolen or misfiled, the way paper records can. However, online records, as well as paper records, are both susceptible to security concerns.
What is Data Breach Insurance?
The standard data breach insurance definition is “insurance to help cover penalties, legal costs and fines arising from claims related to cyber or data breach.” In reality, this coverage is more complex than that. Data breach insurance, depending on the details of the policy, can also help cover you for:
- After-hack costs. The costs of online credit monitoring, the expenses of notifying patients of a hack and other costs related to a security breach are addressed by this coverage.
- Privacy liability and security liability. Claims alleging that you did not do enough to prevent a hack or to secure online information are addressed.
- Asset protection. The costs associated with recovering and replacing data which has been corrupted, lost or damaged due to online crimes or attacks.
- Claims stemming from third-party negligence. Even if you take steps to secure your online records and data, you are likely passing data back and forth with other offices and professionals. In addition, you may be using third-party software or online services to store data. If your patient or other data is hacked due to the software design or negligence of others, you may still need to defend yourself if you are named in a claim.
- Regulatory non-compliance issues. Data compliance standards (HIPAA, HITECH and Gramm-Leach-Bliley Act) require doctors and medical organizations to secure their data. After a claim, doctors may face allegations of noncompliance as well as civil legal claims from patients.
Data breach insurance is important because the costs of a data breach are substantial. You may need to investigate to determine where the breach took place and may need to update or completely revise and update your software system and online data storage system to protect it in the future. In addition, a data breach can directly affect the number of patients you have and the reputation your office enjoys. Insurance in the case of a data breach allows you to at least cover legal and fine or penalty costs, allowing you to focus on serving your patients and developing your practice or career.
If you would like the right medical malpractice insurance and data breach insurance, Gallagher Healthcare offers solutions in Cyber and Billing Risk Insurance, as well as other types of coverage. Contact Gallagher Healthcare today to request a quote.