Cybersecurity insurance is certainly an important piece of the puzzle. If the worst happens, it can help to cover significant financial losses thus limiting the damage to your company. Like with any type of insurance though, you really don’t want to be in a position to have to use it.
Your insurance should only be called upon if every other line in your defence has failed; so let’s make sure you’ve got your house in order.
What is Cyber Insurance and why should you have it?
It’s crucial to understand what your policy will and won’t cover. Most cyber insurance policies cover first party and third party financial and reputational costs relating to damage to, or loss of information from, IT systems and networks, caused by unauthorised IT system access; usually a breach or an attack.
Many policies include cover for the following:
Investigation of a cybercrime
Recovery of lost data in the event of a security breach
Computer systems restoration
Compensation payments to affected parties
Ransoms demanded by criminals
Costs associated with notifying any third parties affects
Some cyber insurance policies also offer support with income loss if your business needs to close temporarily because of a cyber attack.
Cyber insurance also generally includes significant assistance with and management of cyber incidents both before and after an incident has occurred.
However, with cyber attacks evolving constantly, there is a chance that the type of attack you may fall victim to isn’t covered by your policy. With this in mind, it’s important to make a regular review of your policy part of your overall cyber resilience policy and ensure that it covers you and your particular business needs adequately.
Having insurance doesn’t mean that you should be reckless with your security. Quite the opposite, espousing a culture of cyber resilience across your entire business will offer you the highest level of protection.
Before you can take out a policy, many insurers will need to see that you already have robust policies and protection in place. After all, insurance is the last line in your defence. Whilst cyber insurance can be a valuable component of an organisation's overall cybersecurity strategy, insurance should not be seen as a substitute for implementing robust cybersecurity measures but rather as a complement to them. Do not only limit yourself to meeting the minimum cyber security requirements specified by an insurer though as these might not adequately protect your business.
Here are a few general considerations and advice related to cyber insurance:
Risk assessment: The National Cyber Security Centre advises businesses to conduct a thorough risk assessment to understand their specific cybersecurity risks and requirements. This assessment can help determine the appropriate level of cyber insurance coverage needed.
Policy coverage: It's important to carefully review and understand the coverage provided by different cyber insurance policies. Policies can vary in terms of what types of incidents are covered, the financial limits of coverage, and any exclusions or limitations. Businesses should ensure that the policy aligns with their specific needs and risk profile.
Incident response: The National Cyber Security Centre recommends that businesses have a robust incident response plan in place, regardless of whether they have cyber insurance. This plan should outline the steps to be taken in the event of a cyber incident, including who to contact, how to contain and mitigate the impact, and how to communicate with stakeholders.
Security standards and controls: Insurers may require businesses to implement specific cybersecurity standards and controls as a condition of coverage. The National Cyber Security Centre advises businesses to align their security practices with established standards such as the Cyber Essentials scheme or ISO 27001 to demonstrate their commitment to cybersecurity.
Book in a 1-2-1 call with Niomie to find out more.