Data recovery: It’s often overlooked and even more often misunderstood.

In order to succeed in the years ahead, insurance agents and carriers must develop a better understanding of data recovery—and the myths that surround it.

Myth 1: Data recovery doesn’t affect your customers.

Consumers across generations are living their lives on mobile and computing devices. A majority of your personal lines customers have DVDs and flash drives full of family photos and computers with sensitive financial or personal data.

The number of devices in the home has skyrocketed in the last decade: Gartner estimates it could surpass 200 “smart” devices by 2022. Everything from thermostats to TVs to cars are following the trend of the Internet of Things [for more on IoT, keep an eye on IAmagazine.com and the News & Views e-newsletter in the coming weeks].

But even though more and more devices now connect to the cloud, many consumers and businesses fail to back up critical data for several reasons: Cloud computing is misunderstood and still in its infancy, and trust issues emerge from inadequate preparation and giving companies More frequent claims on hard drive failure are mechanical—one backup company found that 4.81% of hard drives fail over time without any cause. Viruses and dropping hard drives are other scenarios that can lead to a claim on personal or business policies.

Businesses, too, are increasingly affected by lost data, but at an even higher loss. They could have all the same claims as an individual, but at a bigger scale and with the addition of cybersecurity losses. The result is an entire new category of insurance that is estimated to be growing at 30% a year.

Myth 2: Most policies don’t cover data recovery.

It’s true that insurance carriers don’t advertise data recovery options in policies, and several don’t provide coverage for consumers. One carrier disclosed it only covers the replacement cost for technology devices, not data. Another disclosed that data recovery falls under “covered perils” in a standard homeowners policy—a category that includes storms, power surges and theft.

Yet another carrier provides an optional rider added to a business policy that covers lost data. Although it excludes floods, as well as mechanical- and employee-caused data losses, coverage kicks in for natural disasters such as tornadoes, earthquakes, power surges and hurricanes. More insurance carriers provide coverage for businesses than personal lines. The claims are much higher, and the cost to recover data from a legacy server can easily run $20,000, compared to $500 for a personal flash drive.

Your tasks as an agent: First find out if the carriers you sell provide coverage for data recovery. Next, understand the different scenarios between individuals and businesses. Because the average cost of recovery for one consumer hard drive is $1,000, many homeowners have too high a deductible and would be excluded. Other homeowners make infrequent claims and may not know their policy covers a hard drive.

For personal lines, most instances of data recovery will result from natural disasters that render significant damage to a home or rental. For commercial lines, myriad scenarios could arise: cyber-caused data loss, mechanical failure on a RAID server and much more.

Myth #3: It doesn’t serve your interests.

There’s nothing a renter, homeowner or business owner wants more than to know everything will be normal again. As an independent agent, that’s your job—you prove your value during a claim. Now that you understand the impact of lost data on a business and family during crisis, you can take ownership of providing a solution.

Just as consumers choose which auto repair shop will fix their cars after an accident, you can choose a data recovery company. Many boast partnership programs that offer up to 25% earned as a referral on the total cost of recovery.

Sean Wade is founder & CEO of 24 Hour Data, a company specializing in data recovery from hard drives, RAID arrays, virtual servers, Macs, SSD, databases and more. 24 Hour Data actively partners with insurance agents and carriers nationwide in providing fast and effective data recovery.