In today’s landscape, there is a gap in the understanding and necessity of cyber insurance. What does this mean for your organization? How can you close this gap to protect yourself better?
With all the types of insurance out there, it can feel overwhelming. What type of insurance do I need personally, and what do I need for my business? Things like homeowners insurance and auto insurance are commonplace. Most people have these policies if they own a house or car.
When it comes to cyber insurance, according to a new study by BlackBerry and Corvus Insurance, the majority of businesses in the United States are either uninsured or underinsured. An ever-changing cybersecurity landscape has left many organizations at risk when it comes to protecting their businesses with insurance against cybersecurity attacks.
Here’s what we know about cyber insurance and ransomware:
- Only 19% of all businesses surveyed have ransomware coverage limits above the median ransomware demand amount ($600,000).
- For small businesses specifically (i.e., those with fewer than 1,500 employees), only 14% have a coverage limit in excess of $600,000.
- 37% of respondents with cyber insurance do not have any coverage for ransomware payment demands
- 43% of respondents with a policy are not covered for auxiliary costs such as court fees or employee downtime.
Source: Forrester report
While many business owners recognize the correlation between business risk and cyber risk, the results of the Forrester report tell us that many are still ignoring the need. Until decision-makers recognize the connection between cybersecurity and the actual operation of their business, the gap will remain (and potentially widen as the cybersecurity landscape gets worse).
For decision-makers that need more convincing, consider these facts from BlackBerry and Corvus Insurance:
- 60% of respondents would reconsider a partnership or supplier agreements with another business that does not hold a comprehensive cyber insurance policy.
- 68% of decision-makers are likely to reconsider a partner or supplier agreement due to cybersecurity practices.
Final Thoughts from PK Tech
While we are advocates of cyber insurance, remember, you can’t just ignore cybersecurity altogether if you purchase a cyber insurance policy. Preventative IT security, coupled with a comprehensive cyber insurance plan, provides the necessary coverage to protect your organization.
Our warning is this: do not assume you can skip cybersecurity because you have cyber insurance. Your reputation is priceless and protect it by taking a proactive approach to cybersecurity. If there is a cyber incident, it may result in the closing of your business if you’re not properly insured to fund its recovery.
We help our clients with their cybersecurity insurance questionnaire and bring solutions to the table as the cybersecurity landscape evolves. Get in touch with our team here.