We’re all used to dealing with insurance for both our personal and business needs, but did you know it was possible to arrange cyber security insurance?
2020 saw financial losses caused by cyber crime topping $1 trillion. Yes, you read that right, $1 trillion. This is a phenomenal figure and one which underlines the damage that cyber breaches can cause. Ransomware, as you would expect, is a major contributor to this figure of $1 trillion and confirms just how important cyber security is. However, no set of defenses are 100% perfect. Accordingly, it’s possible for any organization to suffer financial losses. And this is where cyber security insurance comes in.
To help you understand the benefits of cyber security insurance and how it works, we’re going to take a quick look at the subject.
What is Cyber Security Insurance?
The impact of a data breach can be catastrophic for a business. Not only is there the damage to your reputation, but there are also the financial effects. Ransomware, of course, can pose an immediate financial risk. And many organizations feel pressured into paying the ransom fees demanded by hackers. There’s also the major risk of hackers causing direct damage to your hardware which, in turn, may need replacing. Compounding the impact even further is the threat of legal action from customers who feel as though their data has not been protected effectively.
Clearly, a cyber attack can quickly become very costly for your business. And it won’t be covered by your general liability insurance. This is why cyber security insurance has been developed. It serves to protect your business by covering your organization’s liability for any cyber attacks. This insurance is available from a wide range of vendors and is similar to almost all other forms of insurance. Each policy, which can be tailored to your specific needs, is costed accordingly and then registered against your business.
The Benefits of Cyber Security
But what exactly are the benefits of cyber security? Let’s take a look:
- Repairing Damaged PCs: The costs involved with repairing a damaged PC can soon mount up. And if multiple PCs are affected then these costs can skyrocket. But a good cyber security insurance policy should cover the cost of these repairs. This allows you to get your network up and running as soon as possible.
- Recover Ransomware Losses: The funds demanded by ransomware can be costly and, if paid, can put a serious dent in your finances. Thankfully, with cyber security insurance in place, you can recoup any ransom funds through your insurance vendor.
- Help Notifying Customers: By law, an organization needs to contact all affected parties when a data breach occurs. The time and energy required to carry out such a communication can be expensive. But the cost behind this exercise can be negated when you have taken out cyber security insurance.
- Business Interruption Costs: A cyber attack can quickly bring an organization’s productivity to a halt. And this can cost your business a significant amount of income. This loss of income can be countered with cyber security insurance. Just make sure you specify the fine details of this scenario with your vendor.
For more ways to secure and optimize your business technology, contact your local IT professionals.
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