With the growth in the importance of technology and networking over the last 20 years, the business world has recognized the value of protective practices such as cloud backups. More companies have fallen prey to data breaches and the efforts of malicious hackers recently. While it may seem that multinational corporations are the only ones being targeted, any company that is heavily reliant on technology is vulnerable. Cyber insurance was created to help protect businesses in the event of a data breach or network security failure. Never heard of cyber insurance before? Today, we’re going to discuss what it is and how you can evaluate your risk when determining whether to obtain it for your company.
What is Cyber Insurance?
Cyber insurance started out about 20 years ago as errors and omissions insurance, which nowadays is only one part of a comprehensive cyber insurance plan. Errors and omissions coverage protects your company when there are errors in the performance of your services. It can include tech services like software but also covers other professional services like lawyers and doctors.
Another key part of cyber insurance today is network security. If your network security fails, a wide range of different outcomes is possible including a customer data breach, destruction of data, and cyber extortion. Cyber insurance protects your company when technology fails.
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Evaluating Your Risk
To evaluate your risk in determining your cyber insurance needs, it’s worth keeping a couple of things in mind. First, you need to determine the range of possible exposures that may result from a cyber attack or disaster. Do an internal audit or have a third party come in to research your particular risk for a wide range of outcomes. For example, you may need more coverage for data breaches if your company deals with customer credit card payments. Second, you should strive to overlay those exposures with your business’ existing commercial insurance. Many potential outcomes won’t be covered by traditional commercial insurance, but figuring out which ones do will allow you to tailor a cyber insurance plan to fit your needs.
HOWARD TECH ADVISORS: YOUR PARTNER IN TECH
At Howard Tech Advisors, we manage your IT infrastructure so that you don’t have to. Whether you need assistance creating a disaster recovery plan or you’d like to outsource your IT needs, we can help! Keep up with our weekly blog to stay up-to-date on the latest tech trends, security information you need to know to stay safe online, and tips and tricks to effectively navigating an increasingly mobile world.