How to Choose Right Cyber Insurance For Your Company?

Technology is getting smarter and more advanced every day. With the advancement in technology, hacking incidents are equally increasing. Purchasing cyber insurance has become a necessity for companies so how can you purchase the right cyber insurance plan for your company? But first, lets us tell you what cyber insurance does?

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Cyber Insurance: What It Does?

The cyber insurance policy provides coverage to the companies for loss or damage caused by the hackers by hacking into the online server or data of the company. This policy is also known as the cyber liability insurance or cyber risk insurance policy. Any company or business that has their customer’s data stored on their computer or on their online server can purchase this insurance plan.

How to Choose Right Cyber Insurance Policy?

It can be a bit confusing as well as tricky to purchase the right cyber insurance plan to secure your company’s data. Here are certain factors that will help you choose the right insurance policy to protect your company’s data.

1. Improve Your Cyber Security & Architecture

In order to understand the threat points in your company’s servers and clouds, you have to assess the prone to attack surfaces by using the attack surface discovery. You can use different evaluation tools or services as per your requirement. It would be better for you to make a list of hygiene risks that should be enhanced by patching, configuration and other ways of remediation.

Talking about the architecture, well with the growing business, threats increase equally and it becomes necessary to evaluate the architecture and then implement trust models that are context-driven, where the data is stored along with the resources that would remove the implicit trust and put a limitation of the potential cyber threats.

2. Third-Party Risks

We live in the digital era and everything is online and the online world is interconnected which increases the risk of cyber-attacks. To understand the supply chain risk, a third-party risk management program is important. It helps in collecting the relevant signals that assist in informing organizations about security hygiene, attack surfaces, insurance coverage, privacy practices and the protection of data.

It is suggested to keep on evaluating the supply chain partners to make sure that the privacy capabilities and supplier security are up to date. Also, determine that the process of data suppliers is limited and understand if these suppliers should be changed or not.

While assessing the suppliers, it is vital to not forget about the insurance companies. Insurance companies are an important part of the value chain and tempting target for hackers. If hackers can hack into the data of an insurance company then they will get access to the policy data and other personal information of the customers of that insurance company. A supplier risk assessment should look into the security hygiene of the insurance company.

3. Choose Insurance Provider

While purchasing a cyber insurance policy, you need to make sure that the insurance company has a good history of settling the claim. The claim settlement ratio of the company is provided by the Insurance Regulatory & Development Authority of India on their official website every year.

Also, just like every other insurance policy, a cyber insurance policy also has deductibles so make sure to choose the right deductible amount. It is suggested to check if the insurers provide services 24*7 and are available on call anytime.

Apart from this, there is a threat called Advanced Persistent Threat that does not happen in a day or two but takes over a week or maybe months to totally hack into the servers of the company. Make sure to check and see how the cyber risk insurance provider offers coverage for APTs?

4. Coverage for Privacy Breach

Check if the insurance company you bought the cyber insurance from provides cover charges in notifying the customers, legal costs and managing other privacy infringement claims. Since the insurance companies provide coverage for the data breach and other privacy liability costs but do not provide coverage for the above-mentioned expenses. Privacy breach clauses not only provide coverage for the malware threats but also provide coverage for the data loss due to human error caused accidentally.

 

Conclusion

So there are some of the important factors that you need to know in order to choose the right cyber insurance policy. It is also recommended by the insurance industry experts to purchase the insurance policy online instead of purchasing offline. It is because you get to learn about every little detail related to your policy and even calculate the premium amount using the online premium calculator tool.

Written By: PolicyBazaar - Updated: 30 March 2022

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