With the increased awareness of cybersecurity threats in 2019 came the growth of the cyber risk insurance industry. There has been a huge demand for cybersecurity tools and services on the market, leading businesses to focus on refining their security offers.
Insurers have started adding cyber endorsements to their security packages, thus pressuring their competition to do the same in order to remain relevant on the market. Small businesses are finding security packages extremely convenient, as they take away the worries related to security budget control.
What is Cyber Insurance
Cyber insurance can be defined as a security package that protects businesses and individual users from online security risks. Depending on the insurance package, businesses can be protected against a variety of security threats relating to both the information technology infrastructure and online activities.
Advantages of Cyber Insurance
This type of insurance provides several important benefits, especially to small and medium-sized businesses. It is a good addition to the overall risk management strategy of any company that deals with digital devices and informational technologies. Here are the three most important benefits of cyber insurance packages:
#1 Closing the Gap Between Traditional Coverage and Realistic Needs
Cyber insurance is a modern and more advanced solution compared to traditional insurance packages that don’t cover online threats. With the majority of businesses being based on some type of online platform, there is no doubt that traditional coverage has become insufficient to cover all security risks. That’s where cyber insurance comes into the game to secure digital assets along with the traditional ones.
#2 Providing a Budget
Security breaches are becoming extremely costly to recover from. Most small businesses don’t have the budget needed to fight against serious security threats or to recover from major data losses. A cyber insurance package can take away this stress by providing the needed budget. Most cyber insurance packages cover legal fees, identity monitoring and restoration, regulatory fines, data analysis, forensics investigation, and legal settlements.
#3 Providing Resources for Data Breach Response
One of the reasons why cyber insurance packages have become so popular is because they provide the necessary resources for data breach responses. Small and medium-sized businesses are most likely not capable of handling data breach responses simply because of the lack of resources. Cyber insurance companies provide their clients with access to professional breach coaches, attorneys, and other legal service providers.
Conclusion
Overall, cyber insurance packages are a very good investment for businesses that cannot handle the financial weight of security threats. Cyber insurance can also benefit individual users who want some extra security for their data and devices.
With a proper insurance package, you can receive the help you need to fight against a potential security threat. To prevent the threats in the first place, consider the following security measures listed in the NIST cybersecurity framework. However, keep in mind that regardless of how much you prepare for a threat, having a backup plan thanks to an insurance package is always a good idea.
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