Cyber liability insurance is designed to cover your company for expenses that are incurred as a result of any number of cyber events be it data breaches, ransomware attacks, or anything cyber-related that impedes your business. It is important for policyholders to be aware that cyber liability insurance does not replace cybersecurity practices. Because of this, insurance companies have started to impose a set of proactive security controls, tool sets or policies to mitigate your risks.
Cybersecurity incidents can be both costly and highly damaging to a business. Unlike health and auto insurance contracts that function primarily in a reactive fashion, cyber liability insurance is also proactive. Most carriers focus on education and preventative assistance just as much as post-event damage control. Ultimately they want the insured (you) to be a “better risk”. Being proactive about risks means that insurance providers have a set of requirements in place to ensure that your organization is protected. In addition, building a manageable cybersecurity program with a third-party cybersecurity vendor like Vancord can reduce your exposure to risk and control your cyber liability rates.
If you’ve previously had a cybersecurity issue, you know how much it cost and you’ll be more likely ready and willing to invest in the resources and energy of additional security improvements.
So how can you make the most out of your engagement with a cyber liability insurance provider? Here are some recommended tips for those interested in maximizing the value of their contract.
Tips of the Trade
- Know what you’re covering: You should have some understanding of what your exposure looks like so that you can explain it to an agent. How many endpoints do you have? What kind of security are you using? A security review is a great starting point.
- Don’t fear the carrier: The carrier wants to work with you on issues, so don’t be afraid to call them. You won’t have your premium increased when the renewal comes around for reporting a potential problem—but you do want to mitigate the damage as soon as possible.
- Insurance: Liability coverage is not a substitute for a good security program. Making investments for improved security is still necessary, even with the addition of an insurance program.
Consequently, cyber liability insurance can create a false sense of security for your organization if you assume that it takes the place of a proper cybersecurity preventative program. Ultimately, the best risk management program will incorporate a comprehensive security plan and solid insurance coverage. The better your proactive security strategy is in place, the better the terms of your insurance. Ultimately, It’s better to be safe than sorry.
An effective cybersecurity program starts with a comprehensive program that begins with a risk management assessment that considers all aspects of the organization’s business. For more insights into the world of cyber security risk management, click here.