10 reasons to purchase Cyber Insurance – Here are some reasons why businesses should consider this form of insurance.
In arriving at the decision to purchase cyber insurance a business will need to carry out a full cyber risk management analysis detailing vulnerabilities and how the businesses wishes to manage their cyber exposures which may impact on its day to day trading activities.
Once this has been determined the outcome to purchase cyber insurance could be driven by the following factors :-
1.Balance Sheet Protection
Helping to help mitigate a catastrophic compromise of computer systems and network that may endanger the livelihood of a business.
2.Risk Transfer Mechanism
To cover cyber security risks that cannot be managed within the business or where the businesses chooses to insure these rather than to retain.
3.Management “Sleep Easy”
Due diligence assurance for the Board of Directors and members of staff that there is a “layer” of coverage outside of the cyber security measures that are already in place.
4. Contractual Requirements
Coverage may be required by clients being part of contractual obligations to trade with a business. Businesses entering into government contracts are required in some instances to purchase cyber insurance. This requirement is likely to increase within the business community.
5.The Regulatory Environment
The forthcoming General Data Protection Regulation will impose compulsory notification of all data breaches and regulatory scrutiny.
6. Own Experience of a Cyber Attack
A business who has already suffered from a cyber attack my require comfort going forward from the coverage provided by this specialist form of insurance.
7. Substitute for further Security Spend
Cyber insurance could be seen as a lower cost alternative rather than investing further in cyber security within the business.
8 Competitive Advantage
The purchase of this form of insurance should sit alongside Cyber Essentials and ISO 27001 accreditation and a sign to other businesses that cyber exposures are taken seriously to its clients.
9. Business Continuity
Help to get a business up and running again post breach to cover increased cost of working and loss of profits so that they maintain their trading position in their business sector.
10. Vendor Proposition
The vendor proposition included under a cyber insurance policy provides post breach legal services , forensic investigation and public relations consultancy.
Cyber insurance is an evolving form of insurance with policy coverage developing on a regular basis. The coverage provided by the insurance market does vary considerably, with over 30 insurers to choose from , it is important that you utilize the services of an insurance broker who possess the requisite knowledge and expertise to guide a business through the coverage options and has the influence within the market to negotiate bespoke policy wordings.