What Cyber Insurance Policies Offer and What You Should Consider
As the risk of doing business online grows, cyber insurance becomes a way to protect businesses from serious financial loss due to cyber intrusions, IT failures and loss of customer data. However, many companies are unsure of what cyber insurance is, why it’s growing in importance and what the market for cyber insurance will look like in the future. Here’s what you need to know about the cyber insurance market.
Cyber insurance offers protection from the risks present across the Internet, and can cover many different threats, including hacking attacks, customer data theft and internal company data theft. Furthermore, cyber insurance can help you pay for informing customers of a breach and even allocate money to help repair your company’s damage if your system is compromised.
Cyber insurance policy costs vary greatly based on the coverage you’re seeking for your company. Review each policy thoroughly to understand what is covered and what isn’t. Some of the biggest names in cyber insurance include AIG, Aon and Ridge Insurance Solutions.
The Need For Cyber Insurance
Unfortunately, the Web is an unstable and dangerous place. Major companies are routinely hit with hacks and system failures, including millions of customers having credit card information stolen from Target’s system or the embarrassing Sony Pictures’ e-mail hack that resulted in the release of a trove of confidential information.
As a result, it has become increasingly clear you cannot only invest in protecting your network from intruders; you also have to protect your company in the event a breach does happen. It’s not only large companies that benefit from cyber insurance either–statistics indicate that 60 percent of small businesses that suffer from a system breach go out of business within six months. This goes to underline just how important cyber insurance is for smaller companies.
Cyber Insurance Is Expected to Grow
All of these risks might explain why the cyber insurance industry is set to grow rapidly in the coming years. Allianz predicts that the cyber insurance market will generate $20 billion in yearly premiums by 2025, effectively tripling in size from where it is today.
As of now, large tech companies like Google are exploring ways to offer cyber insurance to companies due to growing demand. However, the market is still not firmly established, and there is plenty of room for disruptors to offer new policy models, cut costs for clients and find new ways to market to clients, especially tech-savvy millennials.
Ultimately, cyber insurance is likely to be a vital part of your company’s risk management strategy in the future. By exploring the benefits today, you’ll be well prepared to handle the financial and security costs of operating in an unsafe world tomorrow. If you want to learn more about cyber insurance, feel free to learn more with this helpful guide.