As organizations become more connected and reliant on the digital world, they become increasingly susceptible to cyber-attacks. On the front in, it is crucial to establish proper protocols and invest in up-to-date cybersecurity systems such as system encryption, redundant firewalls and cryptic passwords. But, if a data breach were to occur, cyber insurance may be the key to keeping your business afloat. This being said, cyber insurance is still in its infancy and until Lloyd’s of London’s released its “core data requirements,” accessing risk was near impossible as there were no statistical models to gauge potential risk. Not only do these “core data requirements” help asses risk, they also help address what specific cyber liabilities pertain to particular organizations and in turn, develop the appropriate cyber policy.
However, as cybercriminals find new ways to attack and begin to target unlikely victims, developing the appropriate cyber policy becomes increasingly difficult, making the need for an experienced and trustworthy broker imperative. “Buying cyber insurance is unlike purchasing a general liability policy,” explains David Derigiotis, senior vice president of Farmington Hills-based Burns & Wilcox. Business owners “really need an expert you can lean on who appreciates and understands the complexity of your specific situation.” If an agent doesn’t fully understand the policies, the client may not feel confident enough to make the purchase or worse, the agent may put the company at risk. Companies from all sectors deal with highly sensitive and confidential information, but not every executive understands the importance of cyber insurance. Derigiotis stresses that if “everyone involved – retail agents, wholesale brokers and carriers – better understood these policies, that volume could be double or triple what it currently is.”