Page 34 - The Insurance Times August 2022

servers, mobile devices, electronic systems, networks, and In today's high-tech world, data is everywhere. Data is
data from cyber-attacks. the new oil, and every piece of data has value. We all
rely on the safety of our data and personal information.
Some of the best practices include: A data breach exposes confidential, sensitive, or
protected information to an unauthorized person
Using two-way authentication
leading to expensive legal battles. In the words of Bruce
Securing passwords
Schneier, Data is the pollution problem of the
Installing regular updates
Information Age & Protecting Privacy is the
Running antivirus software environmental challenge.
Using firewalls to disable unwanted services
Pandemic, crypto currency, and the rise in remote
Avoiding phishing scams working are coming together to create a target-rich
environment for criminals to take advantage of.
Employing cryptography, or encryption
Securing domain name servers, or DNS
Sectors such as health and finance are likely to find that
cyber insurance policies cost more due to the sensitive
Cyber Insurance pays for your losses when your security
nature of the fields, they operate in. And it's not just large
has failed to deter attacks & you have suffered financial
organizations that are susceptible to being hacked or getting
damages. It also covers your business' liability for a data
a virus. Most smaller companies lack adequate cyber
breach.
security, making them a tempting target for cyber crimes
such as malware, ransomware, distributed denial-of-service
Cyber Insurance typically pays for
(DDoS) attacks, etc. Cyber attacks and data breaches are
first-party losses (e.g. business interruption, restoration,
time-consuming and growing more so. The typical length of
and crisis communications) and
time it takes to discover and address a breach is 280 days.
third-party losses, (e.g. data breaches, network
A cyber attack isn't merely an annoyance - it may put your
interruption, and notification expenses
company out of operation.
However, cyber insurance offers much more than just Cyber liability insurance, also referred to as cyber risk
compensation for losses. It also provides valuable prevention insurance or cyber security insurance, makes it much easier
and incident response services through the Insurer's global to address cyber attacks without going under financially. It
partner network. These help companies to improve their can cover for incident response, involving a panel of security
cyber resilience and mitigate negative impacts after an forensic experts, lawyers, PR agencies. Legal fees also add
incident. These services include 24/7 access to IT forensic up quickly when cyber criminals are involved, sometimes
experts or legal or crisis communications support. reaching into millions of dollars. Many cyber incidents
require notification to affected individuals and/or regulatory
authorities, which can take time and incur fines or other
Cyber Insurance is important because:
penalties if done incorrectly. It can also help in covering
We live in a digital world & there are more devices than
business interruption losses. The insurance further aids in
people- These days, most of the gadget works on the
restoring personal identities of affected customers. Credit
wireless network, and people are more engaging in such
monitoring expenses are often in thousands of dollars for
network system. No doubt, it makes the overall process
each individual client whose data has been compromised.
easy and contributes to making our life better. But the
It helps in recovering compromised data& repairing
user ignores the other side of this - that is the cyber
damaged computer systems.
security concern.
Attackers are becoming more innovative - Cyber attacks Cyber Insurance can be personalized depending on the
are no longer stopped by antivirus software or firewalls. current business security status & the specific risks the
The risk of cyber attacks is constantly increasing and for business has.
companies and institutions it is no longer a question of
"if" it will happen but rather "when". There are only 2 However, cyber security defense cannot be replaced with
types of companies - those that have been hacked, and cyber insurance. Insurance should complement cyber
those that will be. security technology as part of an overall cyber risk

34 The Insurance Times, August 2022