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In recent news, a data breach affecting P.F. Chang’s was discovered last summer, affecting 33 branches nationwide. In an attempt to defray the cost of recovering and re-securing data, the popular restaurant chain has attempted to file a claim with Travelers Insurance using their general liability insurance policy. According to a report from, this might not end so well for P.F. Chang’s:

General Liability

Travelers asked the US District Court in Connecticut to clear it of any obligation to defend or indemnify the restaurant company during breach litigation. Its argument to the court: that not only is a breach like this not covered in its general policy definitions, but that even if it were, the restaurant company hadn’t met a $250,000 basement floor limit up to which the firm needed to self-insure for covered events.

According to a number of legal and insurance experts, the case is about as open and shut as it gets for Travelers.

“The likelihood that PF Chang’s would prevail seems quite slim,” says Francoise Gilbert, an attorney with Palo Alto-based IT Law Group.

Fortunately, insurance companies, like, offer technology insurance policies. In a nutshell, technology insurance covers problems that may arise with your IT services. From data breaches to system integration and updates, this type of insurance protects your business from the costs associated with fixing the problem.

Why is technology insurance an important insurance for small business owners to get? Contrary to popular belief, small to mid-sized businesses (SMBs) are a preferable target for hackers. In fact, a 2012 survey revealed that 87% of SMBs in the U.S. experienced a cyber-attack on their data systems—and why not? With less encryptions and other security measures, infiltrating SMBs are a walk in the park for experienced hackers.

For maximum protection against cyber-attacks, you should assess the risks your company is exposed to and invest in ways to protect your business. You should also check your technology insurance policy to make sure that it covers the risks you have identified.

As businesses continue their march towards “paperless offices”, the dependence on technology and IT systems will continue to increase. In turn, businesses should take the necessary steps to protect their data. After all, it’s always better to err on the side of caution.

(Source: Why You Shouldn’t Count On General Liability To Cover Cyber Risk;; October 20, 2014)