While the number of companies both purchasing and interested in purchasing cyber insurance is dramatically increasing, the cost of cyber insurance premiums have also skyrocketed due to recent, high profile cyber-attacks. This surge in pricing has also left certain ‘high risk’ organizations “scrambling for cover.” Cybercriminals are constantly finding complex and revolutionary methods of carrying out an attack, resulting in increasingly catastrophic damages and as a result, some insurers have resulted to installing a coverage ceiling, limiting the amount of reimbursements to $100 million. Nonetheless, the number of companies investing in cyber insurance policies is expected to grow and these three tips can help lower your cyber insurance premium and help mitigate the risk of a cyber-attack:
Challenges in the digital age: The most difficult aspect of creating a cyber policy is quantifying a company’s underlying risks. With these risks constantly changing as cyber criminals develop new and sophisticated methods of attack with more damaging motives, premiums are being pushed to an all-time high as gauging risk becomes increasingly uncertain.
Curbing costs: The rising price of cyber insurance premiums raises the question of how to reduce some of that cost. Chloe Green of information-age.com suggests “having a robust and well-tested security program and response plan in place that is superior to competitors’ tends to result in lower premiums.”
Proactive protection: A key concept of the insurance industry is that proactive protection leads to reduced risk. Green compares cyber insurance to health insurance by explaining that it would not make sense for someone to stop caring about their health just because they purchased health insurance – even though that may be the case for some. When comparing to cyber insurance, the same thought process applies: a business should not think they are protected from a cyber-attack solely because they have cyber insurance. While insurance will help replace some of the monetary losses following an attack, your brand’s image and reputation could potentially be lost forever. As a result, devoting a little extra money and time in cybersecurity to address cyber-attacks on the front end will certainly pay off in the long-run.