In a conversation on CNBC’s “Squack on the Street” segment Palo Alto Networks CEO, Mark McLaughlin asserted that executives should not rely exclusively on cyber insurance to provide a safety net against future breaches. The recent Target hack highlighted cyber coverage’s shortcomings, by failing to properly estimate the volume of data at stake and underestimating the amount of coverage necessary to protect the client.
In his new book “Navigating the Digital Age: The Definitive Cyber Security Guide for Directors and Officers,” McLaughlin asserts that lack of empirical evidence around the cost of cyber-attacks makes managing and pricing risk particularly difficult from an insurance perspective. McLaughlin believes the solution to mitigate cyber threats begins with abandoning “cobbled together” and outdated “legacy information systems” and rebuilding servers with modern firmware from the ground-up.