Cyber security is a growing topic, as is the push for cyber insurance. There are many misconceptions about cyber insurance and how it fits into a cybersecurity strategy. So, what is the truth about cyber insurance?

Cyber Insurance is NOT Cyber Security

These are two very different things. Cyber insurance is used to help a company mitigate losses due to a cyber incident after the fact. It is a safety net for a business.

Cyber Security is all the things you do to protect your business to prevent a cyber incident. It is your daily strategy and prevention. Just because you have car insurance does not mean you can drive recklessly.

Cyber Insurance Does NOT Cover Everything

Just like every policy has the fine print, cyber insurance is no different. In fact, some insurance companies have stopped paying out ransomware demands. It is a better stance again cybercriminals. The more we pay, the more we will continue to be targets.

Even the most comprehensive policies will not cover everything. Make sure you understand what is covered, what is not covered, and the requirements to receive a payout. Many insurance companies have cybersecurity requirements you must follow, without error so that you are taking the precautions to prevent incidents…and be able to prove it at any point in time.

No Business is Too Small to Carry Cyber Insurance

Small Businesses are the top target for cyber criminals. They often lack resources unlike enterprises and tend to lag behind when in comes into applying security measures. Even if you do have a strong cybersecurity posture, you have to know you are still a target. Cybercriminals have proven how successful their tactics against companies of all types and sizes. Therefore, you must think it is not a matter of “if” it happens to my business, but “when”. Be prepared to react to a cyber incident and mitigate losses with a cyber insurance plan. Most small businesses owners will invest everything they have into its start up and success, and just like a home or car investment has insurance, so should your business.

Cyber Insurance is Not Always as Easy to Get as You May Think

Because this is such a growing market, it is not always as easy as you may think. Insurances companies may have requirements for you to pass or hoops to go through to asses your risk. Just like those bad driver’s can get dropped from a good car insurance policy or have outrageous premiums, the cyber insurance is no different. They want to maintain the lowest risk of clients. Depending on your industry, policies, if you have fallen victim, or do not have the right security in place, it may be harder to get.

A Strong Cybersecurity Posture Will Give You the Best Price in Coverage and Payout

The better security measures you have in place, the more likely you will get the lower premiums because you are a lower risk for the insurance companies. Most insurance companies require you to have some level of security in place in order to be approved for a claim. Finally, a strong cyber security posture can give you piece of mind that your data and connections are protected, in turn, protecting your business.