A cybersecurity department that is responsible for protecting the organization's assets, data, reputation, and bottom line must have cyber insurance. Preventing potential attacks is important, but no tool, solution, or strategy can guarantee that a company won't succumb to one.
In the face of such a very real risk, a company may want to consider purchasing Cyber Versicherung, which can mitigate some of the implications of a compromise. As we discuss in this article, cyber insurance is what it sounds like, explains how you can use it, and explains how to choose the right policy for your business.
Why Cyber Insurance is Important and Who Needs It
The purpose of cyber liability insurance, also known as cyber risk insurance, is to protect organization from the financial consequences of breaches or incidents associated with cybersecurity.
Organization with smaller cybersecurity budgets who may find it difficult to find resources in the event of an attack are especially in need of some kind of cyber insurance policy. Data breaches cost on average 3.86M in 2020, and every organization is bound to experience a data breach in their lifetime.
You might find it helpful if the financial costs have already been taken care of, or if you can ensure that recovery isn't too complicated. Additionally, it will allow you to focus on your incident response and recovery plan, enabling you to return to business as usual as quickly as possible.
Cyber insurance coverage: What you can expect
Depending on the policy you purchase, you are covered for certain things. The following is an overview of what most cyber insurance policies cover.
Costs incurred due to the incident/compromise
A security incident can have several potential consequence gets hit with a ransomware attack, it may have to pay the ransom before being able to access their files.
As a result of a DDoS attack, a company's website or servers may go down, costing them money while they're unusable or potentially failing to meet their contractual obligations, further affecting their bottom line. The costs of errors and omissions (E&O) are covered by E&O coverage.
Amounts associated with communications
Whenever a company suffers a breach, incident, or exposure, it is often required to develop a communication strategy for the media, employees, customers, and other third parties.
The extent of the attack may also require the establishment of call centers and support services. Communications and notification costs associated with a security incident can be covered by cyber insurance.
Litigation costs, legal fines, and settlement costs
Businesses must incur additional legal costs for regulating issues, investigations, class action lawsuits, fines, and settlements after a security incident or compromise.
In addition to contacting a third-party forensic investigator, working with organization to monitor and restore an individual's identity can require legal services.
Responding to a disaster and recovering from it
Responding to and recovering from a security incident or compromise is imperative. It may be necessary to consult with a third party or partner to determine exactly what kind of data was stolen, how it was recovered, and how it could be prevented in the future.
It's the same if you need to hire any compliance/regulation enforced independent investigator or if you are required to bring in a forensic investigative team. Many times cyber insurance covers these charges.