Emerging trends
Recent surveys show that nearly 50% of companies have cyber insurance policies, up considerably from just a few years ago. While insurance is nice to have there is no replacement for a proper cybersecurity program. Attacks are becoming more and more sophisticated, and companies are starting to realize that no one is safe from a security incident.
What is it good for?
You may have heard about cybersecurity insurance but have not put much thought into it. This type of insurance is a way to mitigate the financial fallout to your business from cybersecurity attacks such as ransomware, data theft, loss of revenue due to downtime because of some electronic sabotage or covers costs associated with hiring an IT security company to respond to your breach. Keep in mind that reputational damages to a company can’t be repaired through insurance, so it is extremely important to prevent your business from being hacked in the first place. If your customers are impacted, you could be liable for damages depending on potential contracts you have in place.
Assessing risk
Businesses are highly targeted even if you are small. When considering cybersecurity insurance or whether it’s worth having, first, you must consider your risk. If your company or industry is known to work with investors’ capital or sensitive data, this might increase your risks of a cybersecurity breach. Another large factor is the complexity of your IT infrastructure. If employees connect to your business network through a VPN, or you have services running on your server that allow clients to access your company resources, this can increase the number of ways in which you may be attacked. Be aware that employees who use email are usually your greatest risk to your security due to phishing attacks. Working with your IT provider to conduct a risk assessment will help to give you insight into potential risks.
Back to basics
Damages of a hack can be extensive, and cybersecurity insurance will only cover your business in certain situations. You must look at the costs and benefits, and it’s not always something that makes sense for every business to purchase. Before you even think about whether you need cybersecurity insurance, you need to look at what you are doing to prevent a breach from occurring. The best money you can spend initially is on basic cybersecurity controls. These might include a spam filter, next-gen anti-virus, employee training, and two-factor authentication while working with the right IT company to monitor your network can drastically reduce your risk.
Insurance does not replace best practices
Even if you have cybersecurity insurance, your provider will require you to follow security best practices to protect yourself for your coverage to be applicable. If you have any questions about cybersecurity insurance or would like a risk assessment, you can book a free consultation below.