Cyber Insurance – what you need to know to protect your business
The huge range of cyber attacks in the modern world means that Cybersecurity insurance is an absolute necessity for your business. The increased number and range of attacks and thus increased claims insurance companies are much more hesitant to offer cover. Here are some of the most common reasons claims are rejected, and how you can ensure you get the cover you need for your business.
- Inability to Demonstrate Proper Security Measures are in Place
You might have some strong security measures and follow a strict set of preventative protocols in your operations, but can you demonstrate this to the cyber insurance company? Insurance companies want to avoid paying out claims at all costs and the most effective way to do this is by ensuring companies take all the preventative measures they can to prevent cybersecurity attacks. Insurance companies will require evidence that demonstrates you are sufficiently protecting your networks before offering any type of insurance cover. However, due to the complex and ever-changing nature of cyber-attacks, companies that do not specialise in cybersecurity can struggle to prove the effectiveness of their systems without assistance from a third-party security contractor, that’s where we can help.
- Lack of Preventative Security Measures
Perhaps the most frequent reason companies are denied cyber insurance is simply due to lack of protective cybersecurity measures. Cyber insurance companies will not offer cover to companies that fail to protect their own network and systems because the risk far outweighs any potential benefits of working with such an organization. If you are unable to demonstrate you have any security measures in place, provided either internally or by a third-party MSP such as us, insurance companies will decline their request for cover because they are extremely vulnerable to any type of attack.
- Inadequate Endpoint Security
Lacking proper endpoint detection and response tools is one of the fastest ways for a company to get denied an insurance claim. Companies must focus on using a comprehensive approach to cybersecurity if they hope to get insurance cover. Relying solely on antivirus software as the only preventative security measure is no longer a sufficient form of protection for an organization, which is reflected in insurance companies’ policies. One area that insurance companies specifically look for is endpoint security.
- Weak Security Measures Within the Supply Chain
When a company is trying to protect against cybersecurity attacks, their network is only as strong as the weakest link in their supply chain. Due to the interconnectedness of modern technology, attackers can target outside partners and providers as a means of gaining access to an organization’s systems and data. Supply chain attacks can allow easier access to networks if the third-party organizations do not have the same level of security measures as their partners, making cyber insurance companies hesitant to offer claims to companies that work with unprotected partners.
- Poor Internal Cybersecurity Training and Awareness
Human error is one of the most common reasons for cybersecurity attacks, acting as the main cause of 95% of breaches. Human error in the cybersecurity realm can refer to anything from inadvertently downloading malware, to not using strong passwords. A company with even the strongest and most secure forms of cyber protection cannot adequately protect against attacks if their own employees are consistently providing attackers with internal access to their network. If you cannot demonstrate you have implemented the necessary safeguards and given your employees comprehensive training on how to prevent attacks, insurance companies can refuse their request for cover.
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