Cyber insurance is a specialized insurance policy that was created to protect businesses from the losses that can occur as a result of cyber attacks. The size of your business does not matter when it comes to needing cyber insurance, and it shouldn’t be your only priority when it comes to your business’s cybersecurity. Read on to learn more about cyber insurance coverage and its cost.
What Cyber Insurance Covers
There are many losses, remediations and processes that cyber insurance covers. Here are a few.
After a breach occurs that results in sensitive customers’ personally identifiable information being affected, it’s required that business and enterprises notify their customers about the data breach. This process is called notification and reporting and can be included in your cyber insurance.
Recovering customers’ personal identities
Another process that cyber insurance will cover is restoring the identities of customers who have had their personal information compromised as a result of a data breach. This can include replacing or updating the customer’s identity documents such as driver’s licenses or passports.
Computer system repairs
If a cyber attack damages your computer systems or IT infrastructure, cyber insurance can cover the costs of repairing and replacing damaged equipment. It can also cover costs associated with losing access to important data due to the loss of a computer system, as well as the associated costs of recovering lost or damaged data.
Attack recovery offsets the cost of hiring a third-party expert to clean up after a data breach and help restore your company’s reputation. Cyber insurance aids in connecting your company with experts who can help restore compromised systems and regain access to lost and stolen data.
These are just a few of the coverages that cyber insurance can provide your business with. However, not all policies are created equally, so it’s important to compare different policies from different providers to make sure you get the one that meets your needs and budget.
What Cyber Insurance Will Not Cover
As many areas that cyber insurance covers, there are also quite a few areas that it will not cover under any circumstance. Here are a few of the areas cyber insurance will not cover in your business’s coverage plan.
If a breach or any other cyber attack occurred before your company was added to a cyber insurance policy, the insurance will not cover it. Cyber insurance will only cover losses that occur during a policy’s term. It’s important to note that if your policy expires in the middle of a cyber attack, the company may not be able to cover any of the losses associated with the attack.
An attack caused by human error
As humans, we are always vulnerable to making mistakes that could cause a security breach in a company’s system. Human errors can be things such as sharing passwords with a coworker through text messages so they access sensitive data, or accidentally downloading malicious software from a phishing email.
Inadequate security measures
Cyber insurance policies will cover cyber attacks only in cases where your company has taken adequate measures to protect its data and systems. This means updating software regularly, using encryption and other security protocols to protect data from cybercriminals and also training employees on the best cybersecurity practices.
Any vulnerability that existed prior to your policy starting will not be covered – meaning if your business suffered a breach and you hadn’t taken any precautionary measures to prevent it from happening again, the insurance would not cover the damage you suffered as a result.
These are a few areas cyber insurance does not cover. When choosing the right policy for your business, it’s important to research what your policy does and does not cover so you can avoid any unexpected expenses in the future.
How Much Does Cyber Insurance Cost?
Depending on where you choose to get your business’s cyber insurance from, the cost of cyber insurance can vary. According to a study done by AdvisorSmith, premiums for companies with moderate risk ranged from $650 to $2,357 for cyber insurance per year. There are a lot of factors that come into play for the costs of your business’s cyber insurance including location, types of security defenses your company has in place and the amount of sensitive customer data your business stores such as credit card numbers and more.
When it comes to choosing a policy for your business, you’ll also have to decide what type of coverage you need and how much coverage for each type of claim you’re willing to pay. Ultimately, the cost of cyber insurance varies from business-to-business.
Cyber Insurance Is Not a Cybersecurity Solution
It’s important to understand that cyber insurance is strictly to be used as a way to remediate the damage of cyber attacks, not to prevent them. In fact, many cyber insurance providers will not provide your organization with insurance if you don’t have preventative cybersecurity measures and policies put in place. It’s up to your organization to ensure you’ve taken all the necessary steps to secure your company’s data and make sure it doesn’t fall into the wrong hands before seeking insurance.
One of the many cybersecurity solutions that your business should implement to strengthen your organization’s security posture is a business password management solution. A business password manager allows you and your employees to track, store, share, protect and manage all passwords. A password manager for your business prevents cybercriminals from accessing sensitive data by restricting access to it and can also serve as a great backup solution for your company in case one of your employees forgets their password or loses their device.
Keeper’s password manager for businesses is zero trust and zero knowledge meaning no one but the end user can view the plain-text data in their Keeper Vault. There are several benefits of having a password manager for your business, including but not limited to complete visibility into employee password practices, secure password sharing and more.
Get Keeper Business today or sign up for a free 14-day business trial.