Q. What do most companies not have none of,
most companies think they have some of,
but no company ever wants to use any of?
A. Cyber Insurance
According to the Computer Security Institute, use of cyber insurance is still low, but on the rise. More than two thirds of 313 companies surveyed have no cyber insurance. The biggest threats – viruses and unauthorized access to information – accounted for over $25 million in losses among the companies. Mobile hardware theft and intellectual property infringement round out the top four threats, accounting for about 75%s of cyberthreat losses. 90% of the companies acknowledged some type of cyber security breach, with annual losses averaging six figures per respondent.
Most companies believe they are covered in the event of a cyber security breach, but most are not. Read your policy carefully to determine if it covers damages related to cyber liability threats such as:
1)Data theft, alteration or destruction (fraud or virus)
3)Intellectual property infringement(patent, trademark, copyright);
5)Third party claims (denial of service attacks).
Some companies try to cobble additional coverage into their bricks and mortar policies. While one policy does reduce the likelihood of double paying for the same coverage, obtaining cyber insurance from a company specializing in such policies has advantages. Probably the biggest advantage is the access to the company’s risk mitigation practices. Insurance companies specializing in cyber insurance ask you a lot of questions about your security procedures. You can use these questions like due diligence check-off list; discovering the most inexpensive way to reduce the most damaging threats. Adding firewalls, comporting with state and federal cyberlegislation, backing-up off-site, updating to the most current antivirus and intrusion software and physically securing mobile hardware are important steps for any company. Having your own cyberliability agent can take you a step further – recommending ways to reduce threats specific to your industry, and even your particular business.
Cyber insurance is more expensive than regular insurance for several reasons. First, customers are not as careful as they should be – they are just not as aware of cyberthreats as they are of a slippery marble floor. Second, the bad guys are constantly trying harder to create a situation where you might actually have to use your cyber insurance. Third, insurance companies have not yet created handy tables that they can use to plug in a company and spit out a premium. All cyber insurers are not created equal. Selecting the cheapest company may be cheaper per incident, but selecting an insurer experienced with this type of policy may make your competition a more likely target.