Cyber Insurance: What You Should Know
Cyber insurance, sometimes known as cyber-liability insurance, protects organizations from the repercussions of cyberattacks and hacking. Cyber insurance can help reduce business disruption during and after a cyber attack and cover the financial costs of dealing with and recovering from the attack.
Who should get cyber insurance?
Cyber insurance may benefit any company with an online component or send and keep electronic data. Any company that relies on technology to execute its operations is pretty much every business.
What types of attacks cause cyber insurance claims?
Many types of occurrences can make cyber insurance claims. Still, the most common right now are ransomware, fund-transfer fraud assaults, and business email compromise scams.
How much does it cost?
The price of cyber insurance is determined by various criteria, including the size of the company and its yearly income. Other considerations include:
- The industry in which the company operates.
- The type of data it regularly handles.
- The network’s overall security.
What does it cover?
Even though different policy providers may cover various goods, cyber insurance is more likely to cover the immediate costs of becoming a cyberattack victim.
What isn’t covered by the insurance?
Some valuable things to businesses aren’t usually covered by cyber insurance, and it’s critical to understand what isn’t covered so that you can adequately protect these assets.
Cyber insurance does not cover the financial expenses of losing intellectual property, nor does it cover the reputational damages.
Does it cover major cybersecurity events?
In 2017, two significant cyberattacks spread worldwide in short succession. First, the Wannacry ransomware attack shut down networks in May, followed by a far more catastrophic NotPetya attack weeks later.
It sounds like the type of situation that would result in a cyber insurance claim being paid out because an organization was affected by an incident that wasn’t their fault. However, some insurers claimed they were exempt from paying out. NotPetya, a malware strike linked to the Russian military, was classified as an “act of war,” invalidating the claim.
This is likely to remain a problem in the future, especially as the cyber and physical worlds grow increasingly indistinguishable from one another.
What do I need to be able to get one?
To get a good offer on coverage, your company will almost certainly have to demonstrate that it is responsible with cybersecurity in the first place. Insurers will be hesitant to take on a client who appears to be on the verge of becoming a data breach victim. When applying for a policy, insurers will want to know what cybersecurity procedures your company has in place.
You’ll be expected to keep accurate records of your cybersecurity as time goes on. In many cases, policies are reassessed every 12 months, so businesses must maintain proper cybersecurity procedures or risk losing coverage even after obtaining cyber insurance.
The future of cyber insurance
Cyber insurance works will change as the frequency of cyberattacks rises and cyber thieves become more aggressive with their assaults. However, as previously stated, cyber insurance providers are unlikely to provide policies to companies that do not prioritize cybersecurity.