The world has faced several cyberattacks in recent years. As technology is advancing the risk to these attacks is also increasing. No, matter companies are focusing more on cybersecurity, but on the other side, hackers continuously plan to breach data and sell it in exchange for cryptocurrency. Cyber Insurance is a significant step to lessen the damage caused due to data breach.
Cyber insurance is just like commercial insurance, but here, the product insured are related to IT (information technology), cloud data, and local store data on the computer or over the network. Commercial insurance protects businesses against risks to property, a potential loss that might occur in future like theft, fire. Most of the commercial insurance brokers also include employee injury, salary issues and other administrative problems.
Insecurities and unforeseen future circumstances tend to create insurance needs. Insurance brokers come up with several plans including life insurance, medicare insurance plans for family, automobile insurance against car or bike, home insurance for protection against fire, independent life insurance in case of accidental death, and most importantly cyber insurance
Why is Cyber Insurance Necessary?
Today, every small to large organization uses internet. From a small retail outlet using an inventory system to manage products to multinational companies using AI and robotics, the internet has become an integral part. Banks, state government departments, are the sectors that rely entirely on the internet.
Imagine if hackers attack the banking sector it will incorporate a substantial loss to both the organization and customers breaching the personal information, credit card numbers, email IDs, passwords, medical records, date of birth and all those details that represents an individual’s identity and what’s more, these details can be misused without knowledge of the person.
However, phishing attacks, data breach, ransomware are handled by cybersecurity team. Cyber insurance for a business in IT can mitigate the loss. Businesses involving stats and data like Moody’s must consider commercial insurance in cybersecurity to lessen the financial burden.
Before deciding on an insurance policy on your own, it is good to consider a professional insurance broker. A broker looks into your business infrastructure and suggests the best commercial insurance available that perfectly caters your organization needs. They advise you the best financial product while taking into account all the parameters like work type, jobs, budget, risks, potential liabilities, internet usage policies, and license standards.
One thing to remember here is not to confuse Insurance Agent with a broker. The definition of an insurance broker and agent should be clear. A broker works independently to choose the best insurance from multiple insurance providers, while an insurance agent represents a single company and its products. Thus, an insurance broker works in broad sectors and suggest the right cyber insurance policy for your business.
What Cyber Insurance Covers?
Most of the business owners ask the question of what cyber insurance covers. Well, it depends upon the business you are. Cyber Insurance generally includes
- The costs to recover lost data due to damage, theft, virus attack or denial of service attack.
- Notification costs to inform parties affected due to a data breach
- Investigation and legal costs
- Income Loss and extra expenses due to immediate danger
- The cost that may apply as a result of cyber extortion by a hacker
- Denial of service to third parties
Most of the cyber insurance schemes add extra benefits so, you may go for the one that best suits your business and meet your demands. Having an insurance cover helps you financially, and you can continue despite the cyber-attack.