What is Cybersecurity Insurance? Do You Need It?
Updated: Apr 6
Since 2020 and the start of the pandemic, a significant rise in costly ransomware demands and other cybercriminal attacks has occurred. Cybersecurity insurance is designed to protect your business assets from financial damages in the event that your system is breached, and private customer information is stolen, or a ransomware attack occurs requiring you to make payment to restore access to your information. Often, breaches occur at the point of transfer, where information is being shared or stored in inadequately protected environments. The costs incurred by data loss are likely not covered by conventional business insurance policies.
How Cybersecurity Insurance Works
Cybersecurity insurance policies are designed to cover risk assessment, financial loss, incident investigation, notification of your client base, provision of protective services to clients following a data breach such as credit report monitoring, and payment of ransomware demands. Cybersecurity insurance may be acquired as a separate policy or as a rider to an existing business policy.
What Cybersecurity Insurance Does Not Cover
Know that most cybersecurity insurance won't cover losses due to technical errors on your part. For example, if your company sells an app with a vulnerability that gets exploited by a hacker and causes damage, your company is liable -- cybersecurity insurance won't cover that. Likewise, insider threat damage is not covered, e.g., if your system administrator or other staff member with authorized system access does damage, whether intentional or inadvertent. Additionally, your business is not covered if you don't have sufficient security protections, policies, and standard operating procedures in place, especially if you were previously aware of a vulnerability and took no mitigation action.
Do You Need Cybersecurity Insurance?
The answer to that depends on your situation. If you store large amounts of Personally Identifiable Information (PII) or Protected Health Information (PHI), or important information about your business online, then you may need to consider cybersecurity insurance. Regardless of the amount or type of data you store, however, recognize that your data has great value, and you must take precautionary measures in preparation for a cyberattack should one occur.
The Best Defense Against Data Breach
If your company stores and shares private/proprietary information, intellectual property, patented data and schematics, confidential research notes and records, and other important and highly valuable information, you should ensure that your system is properly protected with the highest level of security.
At Gold Comet, we are constantly at work developing products that provide the highest level of security. In our Gold Comet Secure File Storage and Secure File Sharing products, as well as our messaging product, we are now implementing quantum-secure technology to create a level of protection unmatched by other commercial services.