Cyber insurance 101: Benefits, limitations, how it works
Commercial automobile and property insurance. Workers' comp and professional liability insurance. Your business likely has policies for these. What about cyber insurance?
Time for some cyber insurance 101. Also known as cybersecurity insurance, cyber liability insurance and cyber-risk insurance, cyber insurance has been around since the 1990s but its popularity is growing fast as enterprises try to offset the costs of security incidents. Allied Market Research estimated the cyber insurance market, valued at $4.8 billion in 2018, would reach $28.6 billion by 2026. Mordor Intelligence predicted the market, valued at $7.36 billion in 2019, to reach $27.83 billion by 2025. And 47% of respondents to a 2019 Marsh study said they currently had cyber insurance -- more than double 2014 numbers.
Cyber insurance can't prevent cyberthreats, but it does help with response, remediation and forensic expenditures post-event. It can assist with PR campaigns or legal fees, such as fines for noncompliance with privacy standards like PCI DSS and HIPAA. It also offsets downtime costs, like revenue lost due to network unavailability after a denial-of-service or ransomware attack.
A cyber insurance policy can also provide access to a ready team of incident responders who know how to contain damage, or forensic analysts who can recover stolen data.
Still on the fence? This cyber insurance 101 guide can help. It reviews common types of coverage, their benefits and limitations, and how select a policy. Next, our expert explains why complementing a risk-mitigation strategy with cyber insurance is a winning combination. It closes with an article on how, to remain effective, a cyber insurance policy must evolve to accommodate known and unknown threats.
The number of data breaches continues to grow, as does the amount of damage they can cause an organization. Could cyber insurance be the key to protecting your company's assets after a breach?