Cyber Insurance Advisory
Preventative measures to mitigate risks to your policy
Cyber Insurance Advisory Services
With the evolution of technology, businesses that want to thrive and gain massive credibility must operate globally while connecting to customers via the internet. Although the internet offers many benefits to organizations, it also comes with a significant amount of cyber risk, one of which is cyber attack by criminal elements looking for ways to access critical business and financial data.
In recent years, there has been an increase in cyber–attacks on small and large–scale businesses. For instance, in 2011, hackers breached Sony’s PlayStation network, and personally identifiable information of 77 million user accounts became exposed. Due to this breach, Sony incurred over $171 million costs.
According to the 2016 Threat Report of The Australian Cyber Security Center, the Computer Emergency Response Team of Australia had 14,804 cyber incidents from July 2015 and June 2016. An estimated amount of $1 billion is what cybercrime costs businesses in Australia yearly.
These and many more incidents are why organizations need to put in place the right cyber insurance policy that caters to their business needs. Read on to find out all you need to know about cybersecurity insurance.
What is Cyber Insurance?
Cyber insurance is one of the most common business insurance areas that protects your business against the legal costs and expenses involved in incidents related to cybercrimes. It is designed to reduce business loss from various cyber incidents such as data breaches, network damage, cyber threats, and business interruption.
Strong cyber insurance can help a business reduce cyberattack by adopting preventative measures and engaging in best practices.
Cyber Security Risks – Types of Cyber Crimes
Cyber threats and attacks comes in different ways, they include:
These are fraudulent online schemes that take advantage of innocent and unsuspecting businesses. These scams can include money scams, prize scams, investment scams, threat scams, identity theft, extortion scams, etc.
Email Spam and Phishing
Phishing is when a cyber–attacker poses a legitimate entity and attempts to lure people into giving out their sensitive personal data such as credit card details. The messages can come in the form of texts or emails.
Credential Harvesting Malware
Denial of Service Attacks
This attack aims to disrupt the normal and proper functionalities of a website or computer by causing an overload.
Who needs Cyber Insurance?
It is vital to wipe out the idea of “My business is too small to be a target of cyber–attack.” The fact remains that most victims of cyberattacks are small businesses.
of small to medium-sized businesses In Australia exposed themselves to cybersecurity risks unknowingly via online activities such as social media engagement or email.
of small businesses in the United States have had a data breach experience
of small businesses in the United States have encountered multiple data breaches.
Therefore, all businesses from small to large need to consider cyber insurance as a part of their risk management strategies.
What does the Cyber Insurance Cover?
Some of the damages covered by cyber liability insurance policies include:
This a forensic cost carried out to confirm and identify the level of data breach. Others include public relations costs, crisis management costs, and credit protection services, etc.
This involves financial losses associated with fund transfer fraud, social engineering, and reverse social engineering.
Claims by affected third parties
This includes costs associated with compensation claims laid against your business by clients affected by the data breach.
Data recovery costs
This includes costs associated with the restoration, replacement, or repair of destroyed data or software.
Business interruption has to do with the loss of revenue due to business interruption by cyber criminals.
This involves costs resolving and defending claims related to the handling of confidential corporate information or personally identifiable information such as violation of consumer protection law or privacy, negligence, regulatory investigation, and breach of contract.
This involves financial payments and costs associated with response to network–based ransom.
Fines and penalties
Fines and penalties are associated with dues you may be required to pay due to customer data loss.
PR and crisis management costs
This involves costs incurred by your business for retaining the services of a PR expert that helps you respond to the damages caused by the breach of data.
Types of Cyber Insurance
Primarily, there are two types of cyber insurance businesses can opt for. Each offers immense benefits.
In this type of cyber insurance, the insurer clears off direct costs of any related cyber incident such as business interruption costs, cost of investigation notifying, and providing credit monitoring services, etc.
Here, the insurer pays for costs suffered by third parties after a cyber incident.
How much does Cyber Insurance cost?
Several factors contribute to the total cost of cyber insurance. These factors include the annual revenue of the business, the size of the business, the industry in which the business operates, the sensitivity of data and, the entire security network of the business.
Businesses operating in sectors like finance and health are more likely to pay higher for cybersecurity insurance due to the high sensitivity data they handle. Businesses with track records of been victims to cyberattacks may also be required to pay higher than those with high regard for data safety.
What is needed for Cyber Insurance?
For an insurance provider to pay out claims, they put in place important strategies to determine if there was truly a cyber attack on your business. The insurer must, before the cyber attack, establish you are taking your cybersecurity strategy seriously.
The insurer carries out a security audit on your business. The organization will also be required to submit documentations assisted by an approved assessment tool offered by the Federal Financial Institutions Examination Council (FFIEC).
The result of the audit and documentation determines what type of cybersecurity insurance coverage can be obtained for your business and the costs. As time goes on, it would be expected of your organization to maintain a good cybersecurity strategy.
Please note that having a cybersecurity insurance policy does not imply that you won’t put in place the right tools and technologies to ensure there is no data breach. In fact, most insurance firms reassess this policy every 12 months and your business can lose out for not maintaining proper cybersecurity procedures.
Why Choose Our Cyber Insurance Advisory Services?
As the world continues to evolve technologically, so are cyber criminals who are now getting smarter at what they do. This is why every business must stay ahead of these hackers by putting the right cybersecurity measures in place. Cybersecurity insurance provides cover for all critical business assets and clients’ information. It also helps you save a lot of costs when a data breach occurs while promoting business continuity.
Uncertainties may arise at any time. Accidents, floods, cyber attacks, loss of data, and malware attacks are disasters that can occur at any time. This is why every business owner must put in place the right cybersecurity strategy and opt for an insurance cover to protect business data.
At DC Encompass, we understand the importance of cybersecurity and the cost implication of a data breach; this is why we offer comprehensive cybersecurity for Cyber Insurance and forensic services.
We work with you to understand your business need and take a proactive approach in putting in place the right cybersecurity solutions for your insurance policy. Our team of experts are available 24 hours daily to provide support and help you avoid potential data breach.
Disclaimer: The information contained on this Cyber Security Insurance Services page is for general information purposes only. If you’re considering cyber insurance, you must consult an independent, licensed insurance professional for advice. DC Encompass cannot be held liable (in any form) if you act on the general information on this page.