What is a Cyber Risk Insurance Policy?
A Cyber Risk Insurance Policy protects the Insured Company from the risk of data breach. A Cyber Risk Insurance Policy pays for the cost of recovering from the Data Breach Incident or any other form of Cyberattack faced by the Insured Company.
What Does It Cover?
Network Security and Privacy Liability Coverage
Network Security Coverage in a Cyber Risk Liability Insurance covers the Insured Party in the event of Network Security Failure due to Malware, Data Breach, Ransomware etc. A Cyber Risk Insurance Policy will pay First-Party Costs (Costs directly incurred by the insured as a result of the Cyberattack) arising out of a Network Security Failure such as Forensic Costs, Credit Monitoring Costs, Public Relations Expenses, Notification Costs etc.Privacy Liability Cover is an important part of Cyber Insurance Policy Coverage. Privacy Liability Coverage in a Cyber Risk Liability Insurance covers the Insured Party from a liability arising out of a Cyber Attack which results in breach of customer’s or employee’s data.
Cyber Extortion Coverage
Cyber Risk Policy Coverage also includes cover for Cyber Extortion (Ransomware). Basically, this provides coverage for claims and costs arising out of ransomware attacks which paralyse a company’s operations. Companies need to pay ransom to Cyber Criminals to restore their networks in such a case.
Multimedia Liability
Multimedia Liability Cover in a Cyber Risk Insurance Policy provides cover for intellectual property infringement (except patent infringement) arising out of the multimedia activities of the Insured.
Business Interruption
Nowadays, most businesses won’t be able to continue operations in case of a Network Security Failure. Consequently, businesses suffer heavy loss of revenues and profits in case of a Cyberattack. A Cyber Risk Insurance Policy will provide cover for Loss of Gross Profits in event of a Cyber Attack.
How Does It Work?
Every organization should conduct a Cyber Insurance Risk Assessment to identify their vulnerabilities to Cyberattacks and even identify which critical assets could be subject of a Cyberattack.Conducting a Cyber Security Risk Assessment would enable an organisation to understand the magnitude of risk and take measures to manage and mitigate the Cyber Risk. Additionally, taking proactive measures to mitigate Cyber Risks could protect an organisation from huge losses in the event of a Data Breach Incident. Additionally, huge expenses in terms of regulatory and compliance costs following a Cyberattack would also be avoided.
Cyber Risk Liability Insurance (Getting Started)
Cyber Risk Insurance Policy is a must-have insurance policy for all businesses today to secure itself. Cyber Risk Policy Coverage varies from one Cyber Insurance Provider to another and it is important to compare and thoroughly read and compare Cyber Insurance Policy Wordings between multiple insurance providers. It is also extremely important to read through the Exclusions in a Cyber Insurance Policy so that you are aware of what is not covered under a Cyber Risk Insurance Policy.