Data breaches, ransomware, failing systems and tech woes of all kinds are in the news every day. There is no shortage of threats, but education about those threats is at an all-time high. Cyber insurance is necessary in order to protect business assets, clientele, and reputation in the event of a major tech disaster.
Falling victim to advanced cyber-attacks isn’t any longer a pitiable excuse, and the general public expects better planning from businesses that handle their data. This article covers a few costly situations and obligation that highlight the need for cyber insurance.
The digital world delivers endless innovation and creativity. From programming to networking to wireless signals and groundbreaking hardware, the only constant changes.
Unfortunately, the darker side of tech changes just as quickly. If you’re not a bleeding-edge tech company, there’s always a chance that you could fall victim to the newest tricks to come out of the hacking world.
Consider a few of these cybersecurity concepts to understand how insurance could help, and take stock of your tech defenses as you think about the costs of being unprepared.
Cybersecurity: A Vast Canyon of Threats and Liability
While a massive media campaign can scare in some respect and protect you as a victim, falling for well-known and allegedly fixable problems will turn your team into fools who have to pay for their mistakes. Being the day 0 victim isn’t a defense you can count on for every attack.
Cyber insurance protects against multiple scenarios that may or may not be covered by industry standards. Whether it’s a lack of due diligence or not being able to attract a cybersecurity team of your own, the cyber insurance coverage will help you with the dollar amounts and tech strategies you need to stay afloat during and after an attack.
The Massive Costs of Identity Protection
An individual may not be able to use their credit card. It could happen when they have access to cash at a local bank, or they may be stuck overseas or just about to pay rent.
Someone who waited their entire life to buy a house may lose big money because their credit score was temporarily ruined. Real estate agents may or may not be forgiving, and competitive buyer markets may snatch the home from a victim’s hands–and potentially leave someone homeless.
Anyone who does business with the victim may suffer as well. Stores may have to report a loss for small goods, expensive yachts, fine dining, or even one-of-a-kind purchases that are now in the wrong hands.
Identity theft and related fraud incidents cost approximately $16 billion per year, but that huge number often drowns out the individual stories. They hurt on a personal level, they could happen to business leaders and the average worker with the same terrible impact, and they lead to a terrible combination of emotions for anyone involved in the breach: anger, desperation, and frustration.
A person who loses good, useful credit in a world built on creditworthiness can be a ferocious foe. Even if the true enemy is a hacker who has nothing to do with your company, the emotional outburst can mean passionate, persistent legal actions and media attention far beyond most poor customer service or production failure complaints.
As you consider cybersecurity insurance, don’t just ask if you can afford not to protect your assets. Ask if you can afford–or emotionally manage–the unbridled outrage of desperate people with their livelihoods on the line.
Ransomware and Other Monetary Demands
One of the biggest topics in cybersecurity is ransomware. This technique encrypts or scrambles data, then demands money for a key that unlocks your data.
While encrypted, your data is useless to you. There’s no easy way to encrypt the best encryption by force, and the techniques are unique and powerful systems used by corporations, governments, and tech-savvy security experts around the world.
In fact, many of of the world’s innovative hacks exist because encrypted information simply can’t be broken into. It’s better to figure out how to get to data before it’s encrypted or figure out how to get someone else’s key.
There is no cure for ransomware yet. Instead, protection means defending against the different virus systems that could infect a system and launch a ransomware event.
Whether ransomware entered your system through a new or innovative set of malware or an employee opening an email, the general public and your potential investors may not be forgiving as time goes by. You need a backup plan, and you need the financial security to enact that plan.
One of the easiest ways to get around ransomware threats is backups. By having a backup copy of your most vital data–or even your entire data system if you’re paranoid or resourceful enough–you can roll back to a point in time before infection.
The backups need to be planned carefully, since it’s possible for malware to reach across USB ports, network connections, and tape drive loads. Cybersecurity insurance can give you the financial backing to work on restoration, and a cybersecurity team with experience in firewall management or sealing systems can keep your backup assets safe.
Having more than one version of your backups on multiple days, weeks, or months will make you even safer.
Breach Compliance Costs
Government regulatory commissions are still playing catch-up when it comes to cyber risks. Sometimes their actions help everyone, but in some situations, you may be responsible for paying off a lot of damage.
Multiple governments require quick, detailed notifications when a data breach happens. People who could be affected by your system’s breach have a right to protect themselves, but the costs aren’t always fair to the business.
There’s something to be said about gross negligence, but if you’re one of the first victims of a new and innovative attack, lacking insurance could leave you dealing with more than bankruptcy.
Cybersecurity insurance can cover the cost of notifications and help you get the word out about your issue before government agencies have a chance to call your team negligent. Combined with good reputation and media coverage, your cyber risks can significantly drop while giving you time to work on damages instead of engineering your own outrage control.
Repair costs, reputation management, notifying the public, and working with the media are all massive challenges. Especially when financial lives are ruined, you can’t treat breaches and tech failure like a simple patch.
Unless your business is ready to invest deeply in PR campaigns and the latest in cybersecurity engineering, insurance is a much more efficient way to protect your assets. There are multiple levels of cyber insurance available to keep your business scalable and cost-balanced.
Contact a cyber insurance professional to discuss the level of protection you need, and to get connected with security professionals who can harden your tech defenses.
Cyber Insurance Defends You from Massive Liability