Cybersecurity – Your insurance agent may be your new best friend!

by | February 17th, 2016

Two words -insurance and cybersecurity. Insurance is something that many people don’t understand completely, and many more are just plain uncomfortable with. Yet, we buy insurance for home, life and auto coverage because we recognize that maybe, just maybe, we’ll need it. Cybersecurity is something that many people don’t understand completely, and even more people are uncomfortable with. We know we want cybersecurity, but we also need to recognize that no digital system, no matter how well protected can be breached and data lost.

There are several things that can occur when your system is breached. First, your system may be damaged and data lost for good. Second, since you are responsible for the data stored in your keeping, you will have many angry people looking to cause you legal and financial difficulty. That can come in the form of customers suing for damages or perhaps even worse….the government looking to admonish you for failure to exercise ‘due diligence’.

Which brings us to cybersecurity insurance. This is especially important topic, especially if you are a small business owner. Bear in mind that over 60% of small business that are breached close their doors within six months of the breach. Just as you recognize the value of insurance for home, life and auto, so you should consider obtaining cybersecurity insurance, and hope you never need it.
Insurance considerations-

Once you have decided to purchase insurance there are a number of points you need to consider. First, since few people really understand this new thing called cybersecurity insurance (including some agents) you will need to carefully select what you do or don’t need. Just calling your insurance agent and saying ‘I think I need cyber insurance’, is not necessarily the best idea. One solution is to hire a competent authority that can survey your needs and recommend what your policy needs are and recommend a particular insurance company.

If you ‘do it yourself’, there are some points to consider:

  • Risks – determine what is covered, your losses, customer losses, or both.
  • Third parties – will data stored outside your control, say in the cloud, be covered?
  • Government action – will your policy cover legalities brought against you by the government?
  • Encrypted data – will the policy cover data that is not encrypted?
  • Mobile devices – will the policy cover data lost or stolen from the increasingly popular mobile devices used by employees?
  • Recovery costs – it can cost a good piece of change to restore a system, will that be covered?
  • Credit card and identity theft – will your policy cover fines imposed by the credit card industry or for identity theft caused by the breach?

Unless you are one of the few that is familiar with these insurance questions, and many more, you need competent personnel to advise you on your needs. Cyber criminals are becoming increasingly clever in how they attack systems and some experts claim there are only two kinds of digital systems, those that have been breached and those that soon will be. Don’t get caught unprotected, consider appropriate coverage, pay for it, and hope you never have to file a claim.

Here at Excelsior College, we offer degrees (Online BS in Cybersecurity and Online MS in Cybersecurity) and training that teach learners to secure business information, identify security threats and guard against potential hacker attacks.