According to the Allianz Risk Barometer 2022, cyber risk is the year’s top global business risk. Indeed, these attacks can hit companies hard. According to IBM, security incidents have become more costly and harder to contain due to drastic operational shifts during the pandemic and with many companies adopting hybrid work schedules. So what’s the best course of action to boost cyber risk management practices?
Annmarie Giblin, Partner at Hinshaw & Culbertson and leader of the firm’s data privacy and cybersecurity practice, recommends taking the following steps to minimize disruption and encourage a faster response:
- Print out a hard copy of any necessary policies and plans, like the cyber incident response plan, the cyber insurance policy, and a contact list for the organization.
- Remind employees about common cyber scams and reiterate that there will be no negative consequences for reporting an incident.
- Set up an alternate method of communication in the event that usual systems are not available or trusted.
- Keep track of the latest threats and make sure your security measures are updated to thwart them.
- Evaluate and test your business continuity plan. Ask yourself: “What does the workday look like without access to the business’ systems?” and “How can we still work without technology support?”
For most companies, the best response to the increased risk is to focus on ensuring your company has an updated and detailed incident response plan, reviewing and strengthening your general cybersecurity measures, and reminding employees about good cyber practices.
Cyber Insurance Can Help A Company Recover from a Cyber Attack
Protecting your company with cyber insurance is more important than ever. Cyber insurance can be essential to helping a company recover after a cyber attack with costs that include business disruption, revenue loss, equipment damages, legal fees, public relations expenses, forensic analysis, and costs associated with legally mandated notifications. However, a lesser-known benefit of cyber insurance is the role it can play in protecting a company long before an attack occurs.
Most insurers want to help policyholders avoid a cyber attack. They provide policyholders access to risk management services, cyber security experts, and other resources to help prevent a cyber attack. In addition, having cyber insurance can also help a company respond effectively in the critical hours and days following a cyber attack.
Regardless, all companies, even the most prepared, are susceptible to cyber attacks. Cyber insurance provides a financial safety net that’s designed to save them from going out of business when a cyber incident does occur.
Cybersecurity insurance (cyber insurance) is a product that enables businesses to mitigate the risk of cybercrime activity like cyber attacks and data breaches. It protects organizations from the cost of internet-based threats affecting IT infrastructure, information governance, and information policy, which often are not covered by commercial liability policies and traditional insurance products.
How Cyber Insurance Works?
Cyber insurance coverage works the same way as businesses that purchase insurance against physical risks and natural disasters. It covers the losses an enterprise may suffer as a result of a cyber attack.
Pricing cyber risk will typically depend on a company’s revenue and its industry. To qualify, the company will likely need to allow an insurer to carry out a security audit or provide relevant documentation courtesy of an approved assessment tool. The information accrued from an audit will guide the type of insurance policy the provider can offer and the cost of any premiums.
Policies often vary between different providers. Therefore, it is best to work with a knowledgeable insurance advisor who can help you review any details carefully to ensure the required protections and provisions are covered by the proposed policy. The policy also needs to provide protection against currently known and emerging cyber threat vectors and profiles.
Consider your reliance on technology to store data, process orders, and conduct business. If you rely heavily on technology and would be unable to operate if your computer systems got hacked, or if you wouldn’t be able to afford the costs associated with a data breach, you need cyber insurance.
Hackers are targeting both large and small companies. It’s often easier for hackers to breach smaller companies. Don’t wait for a problem to happen before you consider getting a policy and shoring up your defenses with a cyber insurance risk assessment.
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About the Author
John Kersey joined Healy Group in 2003 and has over 30 years of experience designing risk management programs for commercial clients. As a risk management advisor, John strives to build strong relationships with his clients and business partners to understand their needs better and provide the best risk management strategies for their unique situations.