With more businesses moving online, they face an increased risk of cyber attacks. One way to help your business recover following such an attack is through cyber insurance. This type of policy covers financial losses caused by events like data breaches, cyber theft and ransomware, among others.
Cyber insurance may be useful in a variety of ways since it generally covers the expense of:
- Recovering data
- Legal proceedings
- Notifying stakeholders about the incident
- Restoring the personal identities of those affected
There are several misconceptions about cyber insurance to should avoid so let's debunk them one by one.
Types of Cyber Insurance & What They Cover
By busting the top cyber insurance myths, you will be able to make more accurate decisions for your business.
- Myth #1: All I need to protect my business from cyberthreats is a cyber insurance plan
- Myth #2: I don’t need cyber insurance since I have cybersecurity solutions
- Myth #3: Cyber insurance is easy to get
- Myth #4: If I have a cyber insurance policy, my claims will be covered in case there’s an incident
Myth #1: All I need to protect my business from cyberthreats is a cyber insurance plan
This is not the case at all. Your insurance provider will only cover your business if you fulfill the conditions outlined in your contract. Your insurance company is more likely to pay your claims if you can provide evidence that you have been following the preventive measures laid out in your policy.
Many insurance providers will only work with you if you have high-quality cybersecurity protection. With so many cybersecurity solutions on the market, it's important to remember that they are not all created equal. Finding a solution that is best suited for your needs is of utmost importance.
Myth #2: I don’t need cyber insurance since I have cybersecurity solutions
Despite the fact that cybersecurity solutions can help you protect yourself from cyber attacks, they do not guarantee your safety. While cybersecurity solutions can reduce the likelihood of a cyber attack by safeguarding vulnerable areas in your system, nothing can provide guaranteed protection from all potential threats. This is because new risks are constantly emerging, making it difficult to stay ahead of them.
Human error, no matter how secure the system is, can always expose it to danger. That's why having a cyber insurance policy in place might be a wise precaution.
Myth #3: Cyber insurance is easy to get
With the occurrence of cyber breaches increasing with time, so does the incidence of cyber events. Small and medium-sized businesses are among the most vulnerable targets for hackers since they lack enterprise-level security.
As a result, insurers are unwilling to issue coverage since the hazards are serious. While policies remain available, they are becoming increasingly costly and difficult to acquire.
Myth #4: If I have a cyber insurance policy, my claims will be covered in case there’s an incident
If you can't show evidence that you've met your insurance policy's conditions, then your claim will probably be rejected. This is why it might be a good idea to team up with an IT service provider. A reliable IT service provider can assist you with staying compliant with your cyber insurance policy, as well providing evidence to prove compliance.
Download Our Cyber Insurance Checklist
It's critical not to be misled by the following cyber insurance misconceptions in order for your company to qualify for a policy and receive coverage. However, it's also vital to remember that cyber insurance is more difficult than most people realize.
To protect your business effectively in any industry including healthcare or oil and gas, partner with an IT service provider who can help you understand how to increase your chances of receiving coverage and a payout in the event of a cyber incident.
Learn more about cyber insurance tips by downloading our checklist!
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