Cyber Liability Insurance Explained  

It’s hard to imagine being able to do business without the help of the digital world. Many SME’s rely on some part of their business being online, unfortunately creating the risk for cyber criminals to attack. That’s where Cyber Liability insurance can provide some much-needed peace of mind and protection. 

Most SMEs depend on their data to perform a range of day to day functions. With more and more data stored online, connecting to the internet opens the possibility for hackers to attack. An attack can be anything from a hacked website to theft of sensitive client data, to a ransomware threat.  

With an increase in cyber attacks on small business* operators, it is worth considering Cyber Liability insurance and how it can protect your business.   

https://www.ncsc.govt.nz/newsroom/ransomware-advice/Our guide looks at some of the basics of what you need to know about Cyber Liability insurance, the kind of things it provides protection for, and much more! 

What does Cyber Liability insurance typically cover?  

Cyber liability insurance is a type of business insurance which protects your business 

against both the legal costs and expenses related to cybercrime 

incidents. Your coverage may generally include cover for expenses and restoration costs relating to the 


  • Data breaches including theft or loss of client information

Network Security Breaches 

  • Business interruption costs
  • Forensic investigation into the cause or scope of a breach
  • Data recovery costs
  • Cyber Extortion
  • Crisis management costs (to protect or mitigate damage to your businesses reputation resulting from a cyber event)
  • Loss and Legal costs, including fines and penalties resulting from athird partyclaim for data or network security breach against your company 


Why do I need to consider Cyber Liability insurance?  

A common misconception is that hackers only go after the big fish but when it comes to attacks. Companies big and small are a target. Even when you take the right measures to prevent an attack from occurring, hackers are increasingly getting smarter and sneakier when it comes to attacking systems.  

Not sure if Cyber Liability insurance will be beneficial to your business? Consider the following:  


How valuable is the data you store? Do you store personal or commercially sensitive information about your clients, suppliers or your own business?  

Do you have a robust IT infrastructure in place?  

Are all your systems up to date with the latest anti-virus protection software?  

Do you have adequate resources and an incident response plan to manage a cyber incident?  

To understand if a Cyber Liability policy would be beneficial to your business, ask yourself the following questions:   


How valuable is your data? Do you store personal or commercially sensitive information about your clients, suppliers or your own business?   

How robust is your IT infrastructure? Is it up-to-date with the latest anti-virus protection software?  

Are you and your employees adequately trained on what to be aware of, how to prevent a cyber incident from occurring and recognising when a data breach has occurred?  

Do you have sufficient resources and an incident response plan to manage a cyber incident?  


Who needs Cyber Liability insurance*? 

Cyber Liability insurance is designed to assist any business that uses technology in its daily operations – whether sending an email, storing data online, receiving wire transfer payments or using software in its day to day operations .  

For a small business, the consequences of a cybercrime event could be devastating. Not only could they lose client data, critical operational information and network capability, but the damage an attack could do to a business’s reputation in the community could be just as harmful. 

This is where Cyber Liability insurance provides a vital protection for SMEs in NZ, as it helps protect businesses against the threats and exposures associated with data breaches, system interruptions and cybercrime including hacking and theft.  


The types of businesses that use technology are extremely varied, but here are a few examples of some businesses that may be impacted by a cyber-attack. 

  • Businesses using computers,phonesand other electronic devices to run their business and to help communicate and connect with their clients are at risk of a system outage caused by a cyber event.  
  • Retailers and hospitality industries rely on technology such aspayment terminalsand websites for online sales to help sell and manage sales. 
  • Manufacturing businesses rely heavily on machinery to get the job done, a virus or attack on the systems used to help operate the machines could cause major disruptions to the production of stock.
  • Professionals who store sensitive client information and details in their databases are at risk if a potential privacy breach were to occur.


What is typically not covered by Cyber Liability insurance?  

Replacement equipment   

Property damage   

Prior known facts / circumstances (before the policy commenced)    

Intentional acts   

Types of Cyber Liability claims  

These are just a snapshot of some of the types of claims which Cyber Liability insurance protects your business from: 

  • Website hijacked and defaced  
  • Computers infected with viruses/malware  
  • Data held to ransom  
  • Wrong email attachments 
  • Lost or stolen devices  

How much does Cyber Liability Cost? 

Each business is different with an exposure to various risks. There isn’t a one size fits all Cyber Liability insurance policy, so the actual cost will depend your business and its unique factors.  

What factors affect the cost of Cyber Liability insurance? 

Some of these factors include things like: 

  • The size of your business 
  • The type of activities your business performs 
  • The amount of coverage you select 
  • Claims history 


When you run your own business there is plenty to think about, but we can assist you getting Cyber Liability insurance sorted so you have one less thing to worry about. 

At BizCover, we understand many types of small businesses and their unique business insurance needs. Insurance products purchased through BizCover are there to help your business when you need it most. 

Our online platform takes the drama out of shopping around for your insurances, delivering quotes from selected New Zealand insurers in minutes. We don’t believe in making things difficult, so there’s no paperwork required or messy forms to fill out. Experience insurance made easy today and see how we can help protect your business.


* The information provided on this page is general guide only and does not take into account your personal objectives, financial situation or needs. This information should not be construed as any form of advice. Consider your own personal circumstances, objectives, financial situation, needs, Product Disclosure Statement (PDS), and full policy terms and conditions before making a decision. Product descriptions on this page are intended only as a guide to coverage terms and conditions, and should not be relied upon to determine policy coverage. Policy coverage is subject to the specific terms and conditions of each policy wording.  

The provision of the claims examples are for illustrative purposes only and should not be seen as an indication as to how any potential claim will be assessed or accepted. Cover for a claim will depend on the specific circumstances around the loss and would be subject to the terms and conditions of the policy concerned.  

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