The number of data breaches are constantly on the uprise, and they are costly. That being said, business owners are taking preventative and proactive measures to secure and implement good cybersecurity practices. There is a new kind of coverage, and it is called Cybersecurity Insurance. Cybersecurity insurance is designed to mitigate losses from a variety of cyber incidents. This includes data breaches, business interruption, and network damage. Cybersecurity insurance is a standalone coverage. It helps cover the costs of data breaches. However, it does not prevent companies from being subject to breaches.
Two Types of Cybersecurity Insurance Coverage:
There are two different types of cybersecurity coverage: first and third-party. First-party coverage is protection for the data you own, such as information that pertains to your customers or employees. Third-party coverage provides protection for liability associated with your customers’ data, among other things. There are insurers that offer cybersecurity insurance policies with combined features of both first and third-party coverage plans.
These policies can be expensive. They will modify premiums. They adapt to fit a particular company’s needs and because of this, policies are timely. In addition, they are more costly. Cybersecurity Insurance policies are different from general liability. Premiums vary and factor from your company’s practices, risks, exposures, financial state, etc. These policies do not cover theft of intellectual property. Although this may change in the future, cybersecurity insurance is still new and developing.
The Investment is Worthwhile!
There are no businesses exempt to breaches or network damage. In fact, making the investment in insurance can be a smart decision for your company’s protection against breach costs and damage. The safer your company gets, the more your premium will drop. It is important to note that these policies mitigate risk. Additionally, they are a key role in building and creating a comprehensive plan for risk management.
Cybersecurity insurance increases and improves cybersecurity with the benefits of good security, and internalizing of the costs of poor security. There are many benefits that coincide with investing in insurance. Grow your security, because the number (and costs) of breaches are growing.