In the 21st century, advancements in technology have given businesses of all sizes great improvements in efficiency, compliance and overall productivity. Beware, this advancement in infrastructure does not come without the added threat of cyber attacks. 2017 cyber attacks are estimated to have caused $5 billion worth of damages worldwide – this is 15 times higher than the amount of damages from two years ago despite record spending on cybersecurity. Since there is no indication of this trend slowing, security measures alone are not enough to protect companies from the damage of cybercrime. Additional protection to you and your business can come in the form of cyber insurance.
Cyber insurance helps businesses recover from internet-based risks and attacks on their information, technology infrastructure and sensitive data housed within, all of which are not covered under traditional general liability policies. Specifically, policies can cover damages such as denial of service, data destruction, data theft and/or extortion and defamation of reputation. Policies can also cover costs relating to incident response and remediation, forensic investigation and security. All of these can provide much greater peace of mind for management at a cost that can be surprisingly affordable.
For businesses with revenue of $25 million or less, only around 20% have some type of cyber coverage. Recent trends have shown that overall cyber
insurance premiums for small businesses have actually dropped over the past year due to a high level of competition in the market leading to insurers battling over market share. Even in highly sensitive areas, such as healthcare and social services, decreases in rates were seen as high as 21% over the previous year. These costs can also decrease based on either the business’ existing cybersecurity measures in place or measures that will be developed in association with purchasing a cyber insurance policy.
It is imperative that management of businesses review their current IT security plan and look towards adding cyber insurance as a final layer of prevention against the crippling financial impacts which cyber attacks can cause. Premiums are projected to remain affordable in the short term which may be seen as a bargain by management looking for peace of mind against a digital nightmare. Stay tuned for more updated on insurance measures and tips for you and your businesses!
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