When it comes to securing your business, cyber insurance is more than a friendly suggestion—it’s a necessity. Imagine your worst nightmare coming true—a hacker accesses your customer data, infects your business systems with malware, or launches a ransomware attack.
Cyber insurance can help you recover from these events and protect your business against financial losses. In 2021, it was reported that 8,100 cyber insurance claims costs were paid.
And without it, you’re left paying out of pocket for damages and lost income because of your lack of cybersecurity measures.
Everything You Need to Know About Cyber Insurance and What It Covers
As your saving grace, cyber insurance provides financial help in case of a security breach or other online data loss. The exact coverage offered will vary depending on the provider, but generally, cyber insurance covers costs related to the following:
- Data Breaches: Your cyber insurance will cover costs associated with notifying affected customers, providing them with credit monitoring services, and reimbursing them for any financial losses.
- Cyber Extortion: provides funds to pay cybercriminals who threaten to launch a distributed denial of service (DDoS) attack or publish stolen data unless a ransom is paid.
- Business Interruption: The cyber insurance coverage helps cover lost income and related expenses due to a cyberattack.
- Privacy Protection: Your policy will cover the costs of defending your reputation and legal fees related to privacy litigation.
What Is Not Covered?
Now that you know all the reasons why you should get cyber insurance, it’s important to know what is not covered so you’re not left hanging. Cyber insurance coverage will generally not cover the following:
- Loss of data due to employee negligence or mistakes.
- Reputational damage caused by a breach—even if you have the coverage, insurers are not likely to step in and cover it.
- Damage caused by intentional acts, fraud, or illegal activity.
- Physical damage to property resulting from a cyber incident.
- Coverage may be denied if a cyber incident occurs due to known vulnerabilities that the insured failed to address or mitigate.
First-Party vs Third-Party Cyber Insurance
When considering cyber insurance for your business, there are two types of coverage available: first-party and third-party.
First-Party Cyber Insurance
First-party insurance covers the costs that your business incurs as a result of a cyberattack, such as data recovery costs, legal fees, and lost income. So when your systems are breached, you can count on first-party insurance to help cover the financial losses.
Third-Party Cyber Insurance
On the other hand, third-party coverage is there for when another party experiences a breach of your systems, and as a result, they suffer financial losses such as legal fees or lost income. This type of policy will cover the cost associated with defending your business against claims from affected individuals.
How Do You Qualify for Cyber Insurance?
The beneficial part about eligibility for cyber insurance coverage is it only strengthens your business’s security.
Here are some of the requirements that are needed to qualify for cyber insurance coverage:
- Strong access control measures
- Robust incident response plan
- Employee training on cybersecurity best practices
- Multi-factor authentication
- Privileged access management
- Encryption of sensitive data.
Once those measures are in place, you can apply for cyber insurance and rest assured that your business is protected.
Cyber Insurance Shouldn’t Take the Place of Cyber Defense
Cyber insurance should be at the top of your list when it comes to protecting your business. While cyber insurance can provide much-needed financial help if you experience a breach, it shouldn’t take the place of sound cybersecurity measures.
Insurance is intended to cover costs that can’t be avoided or mitigated with preventative security measures. Don’t let it be an excuse for businesses to neglect their cyber defense responsibilities.
Make Your Business Eligible and Cybersecure with adrytech
At adrytech, we offer comprehensive cybersecurity solutions tailored to your specific needs. Our team of experts will assess all the risks your business may face and develop a bespoke cybersecurity strategy to help your business stay secure.
In turn, we can help you get cyber insurance coverage by providing the necessary security measures to make your business eligible. Contact us today for more information on our cybersecurity services!
Why It Pays to Be Prepared: Cyber Insurance Webinar
We would like to invite you to attend a cybersecurity webinar on July 20th as our partner, Barracuda MSP, shares what insurers are looking for in potential policyholders. You’ll learn more about the potential consequences of not being fully prepared and the online tools that can give you an accurate assessment of your current ransomware risk.
PLUS, all attendees will be entered into a draw to win some great prizes including a pair of Apple AirPod Pros!
Don’t miss out! Register today.