The data on a hard drive can be the most valuable possession in an office or a home. It is critical that you know whether or not your data is covered by your insurance.
We often hear from people who, following a disaster, are most concerned with retrieving their family photos or trying to rescue the essential business records that will allow them to keep running. And sometimes, customers of ours mention that their insurance company is helping them recover what’s so valuable to them: their data — their manuscript, their home movies, their digital records of their lives.
For example, Harris International conducted a survey a few years ago and found that many people indicated that they would not accept $1 million to lose all of their family photos. If an event causes their hard drive to fail, a typical cost to retrieve them is often between $600 to $1,200.
Our interest is whether insurance companies are helping to guide their clients toward successfully recovering an asset that they could value more than their house. We have been researching and reaching out to many insurance companies to see what their policies are for covering the cost of data recovery if one of their clients has a storage device fail.
Not surprisingly, some insurers are in tune with how valuable data can be to their clients and offer to cover the costs of a data recovery after certain events, or as an option. Liberty Mutual’s press office, for instance, said that data recovery would be paid for under “covered perils,” such as a storm, power surge, or break-in. Other popular insurance companies, such as State Farm and Allstate, seem to have a policy for data loss for businesses. Businesses have greater coverage for data recoveries, but it is of course subject to whatever deductible is on the policy. Farmers Insurance also has helped clients with the cost of data recovery. Here is the statement from their press office:
“Farmers Insurance offers an optional coverage that includes the cost of data recovery. Coverage is provided when the storage device is damaged by any cause of loss not specifically excluded. Most catastrophic losses, such as fires, hurricanes, and tornadoes would be covered. However, certain losses, such as flood, wear and tear, operator error, would not be covered due to existing exclusions in our policy.”
Some of these data loss insurance policies are options. These policies don’t always come standard in a home or business insurance coverage, and this is where you have to take caution. Be sure to double check that your insurance policy covers data loss.
Here at Gillware, we see insurance claims come in at least once a week. Most of the time we will have the entire recovery process finished, which includes the data recovery and payment, before we get a call from the insurance company asking about the data loss, and why it happened. Although we cannot describe exactly what went wrong because we don’t do forensics, plus the insurance companies might not understand the details of the recovery, we’re still able to successfully handle insurance claims regularly due to the communication and cooperation between the customer, insurance company and Gillware.
It is important to note here that as the customer you should always be in contact with your insurance agent about your data loss and what your plan is going forward, so everyone is on the same page.
In any case, the easiest and most reliable insurance in the event of data loss is backup. There is no guarantee that recovery will be successful if your device is too damaged from a fire, flood, etc. Not to mention, theft just flat-out leaves you with nothing to recover from. Be sure to have a data backup in place, and always be aware of your full insurance policy.