Cyber insurance, also known as cyber risk insurance or cyber liability insurance, is designed to protect firms from the impact resulting from cybercrime. The cyber insurance market is rapidly changing as threats evolve, which has caused significant fluctuations in premiums in recent years. Cyber insurance covers the costs resulting from cyberattacks. Protection can vary, but typically includes coverage of the following:
- Forensic analysis to identify the attack source
- Ransom demands and specialists to handle ransom negotiations
- Costs to regain access or restore your data from backups or other sources
- Legal costs
- Public relations services
- Notification of clients and/or regulatory bodies
- Credit monitoring services for affected individuals
Why Have Cyber Insurance?
Cyber attacks cripple organizations every year. One in five small businesses fall to a cyber attack and of those, 60 percent go out of business in six months. There are three main benefits of having cyber insurance:
- Financial- The insurance covers costs in the event of a cyber incident.
- Operational- The insurance team provides immediate access to experts, including IT forensic specialists, privacy lawyers and PR pros.
- Peace of Mind- Having cyber insurance gives confidence to your customers, partners, suppliers and employees
How Cybersecurity Can Reduce Premiums
There is a relationship between cybersecurity and cyber insurance costs. Having a strong cybersecurity posture can reduce your premiums. It works the same as home insurance. If you have stronger home security measures in place, your home insurance premiums can decrease. While cyber insurers don't publicly reveal their calculation for premium costs, customers consistently say that their premiums decrease as they invest in cybersecurity measures.
If you are interested in a deeper dive into cyber insurance, we invite you to view Sophos' Guide to Cyber Insurance by clicking the button below.