PREVENTIVE MEASURES - How Cyber Insurance solves the problem

How cyber-insurance solves the problem

With the increase in cybersecurity risks around the world, it is imperative that companies take proactive measures to protect their data and those of their customers. One way to do this is through the purchase of a cyber insurance. Known as cyber liability insurance, network security policies, Internet liability coverage and other similar names, cyber insurance covers losses related to data breach. It differs from traditional technology errors and omissions (E & O) in that cyber coverage protects both entities (companies) and victims (consumers), while E & O technology protects technology product providers, such as web designers and computer software.

Cyber insurance has been available since the late 1990s. In the beginning, this commercial product met the needs of limited corporations, those that had just begun when the Internet was relatively new. The first forms of coverage were in fact complements to the existing E & O protection. Most companies have been slow to adopt cyber coverage because until very recently, it had not been tested to a large extent in the market. Each month, with more virtual thefts, the product itself has evolved along with the industries it serves. From small businesses to large retail chains, cyber insurance policies address the growing demand for better online protection against hackers, cybercriminals and political activists.

Cyber protection policies cover different areas of cybersecurity, and because there is not yet a standard subscription procedure, insurers must customize specific plans for different companies. This can be a costly investment for companies, but the costs of disbursing a data breach are substantially higher. In addition, personalized plans allow a company to buy exactly what it needs, assuming that the organization can evaluate its own risks. According to the National Association of Insurance Commissioners, coverage varies widely in the cyber insurance industry, but companies can find policies that cover one or more of the following:

• Initial costs related to forensic investigations after a data breach

• Costs related to data breach, such as the costs necessary to notify consumers, provide support to those affected and pay for credit monitoring

• Liability coverage for negligence, as in the case of a company that involuntarily or intentionally allows unauthorized users to access their computers

• Coverage of liability for problems such as copyright infringement, defamation, defamation and disregard for the product if it is a company's website, a publication in print media or a social media account.

• Expenses for issues of cyber-extortion or cyberterrorism.

• Recovery for business interruption and related expenses, including the cost of restoring, updating or replacing commercial assets that were stored electronically

In essence, there are four main elements of cybersecurity: coverage for data breaches and privacy crisis management, multimedia and multimedia liability protection, extortion liability coverage and network security liability coverage. As with any type of insurance, however, there are exclusions in cyber policies. It may not be feasible to find a comprehensive plan in the growing cybersecurity insurance market, but companies are constantly reevaluating their offers to meet the increased global demand. Exclusions typically include:

• Acts of terrorism or war

• Coverage for devices that are not encrypted

• Security deficiencies, such as not keeping the devices updated or installing the appropriate levels of antivirus protection on company computers

• Protection for loss that occurs outside the United States.

• Actions and omissions of third parties, such as data breaches that occur with a company's cloud computing provider.