Due to the pervasiveness of technology in our lives today, it is crucial to be aware of the dangers associated with it. Cyber attacks are increasing in frequency, and the devastation they can cause can be catastrophic. Herein lies the value of cyber insurance.
Cyber insurance is an insurance policy that can protect you and your company from cyber attacks and data breaches. Whether you’re an individual or a business, cyber insurance providers in Singapore offer a variety of programmes to protect your digital assets.
It is essential not to disregard the significance of cyber risk liability insurance, and given how simple it is to obtain cyber insurance online, there’s no reason not to have it.
What Is Cybersecurity Insurance Coverage?
Cyber insurance safeguards businesses against financial losses resulting from incidents such as data breaches, system hacking, ransomware payments, and more.
If your small business holds sensitive data online or on a computer, you should get cyber insurance.
With cyber insurance, the company’s liability to pay for any damages resulting from a cyberattack is reduced, thereby mitigating the financial repercussions should a catastrophe occur.
Consider it an option for mitigating the growing cyber risk associated with conducting business online.
What exactly is a cyberattack?
Cyber attacks are unlawful attempts to access the data or disrupt the operations of an organisation for criminal, espionage, political, or prank purposes.
Every day, millions of attacks are launched against businesses, and some are successful in breaching their defences and wreaking devastation.
An increasingly common form of attack uses emails that appear to be from a known teammate to fool people into installing malicious software – it’s a simple error that can result in your business being locked out, losing money, and being held for ransom.
An increasing number of intrusions are caused by disgruntled employees with insider knowledge.
What is Covered by Cyber Insurance?
Any data loss or compromise can have a negative impact on your business. This can include a loss of trust in your company, resulting in a distrustful consumer base, as well as the potential financial costs associated with recovering from such an attack.
Cyber insurance can help mitigate this risk and prevent your business from having to pay for it all out of pocket.
These policies safeguard businesses in various circumstances. If you operate a technology-related business, you should also consider purchasing the different but related technology errors and omissions coverage.
Cyber insurance provides prompt access to experts who will:
- identify the cause of the breach;
- prevent the breach from spreading and causing further harm, and mitigate the breach’s impact.
- address the repercussions (including mitigating ongoing risks).
- restore your organisation to normal operations.
Coverage for third-party or cyber liability
Cyber liability insurance can protect your company if a third party sues you for damages caused by a cybersecurity breach. The coverage is as follows:
- Attorney and court fees related to legal proceedings are typically covered by cyber liability insurance.
- Settlements and court judgements.
- Administrative penalties for noncompliance.
General liability insurance does not cover data breach-related liability claims, so if your business stores consumer data, you should consider purchasing a separate cyber liability insurance policy.
Errors in Technology and Omissions
A Technology Errors and Omissions (E&O) policy is activated when a cybersecurity incident occurs in a client’s business as a result of an error on your part. Consider purchasing this coverage if your company manufactures a technological product or provides technological services.
For example, if a customer’s financial information is misappropriated from your computer, first-party or liability insurance would provide coverage. However, if you create accounting software with faulty code and the customer’s data is stolen directly from their computer, it belongs to tech E&O.
Technology E&O pays for items similar to those covered by cybersecurity liability insurance, such as legal fees, court costs, and judgments or settlements, but only in instances where products or services are involved.
Who Requires Cyber Protection?
Cyber insurance can benefit any business that creates, stores, or manages electronic data online. In the digital age, sensitive customer data such as phone numbers, sales records, personally identifiable information, and credit card numbers are prime targets for cybercriminals.
E-commerce companies can also benefit from cyber insurance as delays caused by ransomware or other cyber attacks can have a negative financial impact.
What is Excluded from Cyber Insurance Coverage?
The coverage provided by your cyber insurance policy depends on the type of insurance you require and the company you work with. Ultimately, cyber insurance policies do not cover the following:
- Any cyber intrusions or events that occurred before the policy was purchased are not covered.
- Costs associated with upgrading your company’s technology systems, including the cost of new applications and the strengthening of security systems.
- Cyber incidents initiated and caused by employees or informants.
- The failure of the company to address documented vulnerabilities. If a vulnerability is discovered and your company fails to address it, your cyber insurance may not cover the resulting breach-related losses.
- Infrastructure failures resulting from external factors other than a cyber event or cyber attack.
- Property damage: In general, cybersecurity insurance does not cover property damage resulting from a data breach or cyber attack, such as hardware that was destroyed during the cyber incident. Typically, claims of this nature are covered by commercial property insurance.
- Expenses related to preventive measures. Typically, a cyber insurance policy will not cover preventive measures, such as educating employees on cybersecurity and establishing a virtual private network, to ward off future cyberattacks.
Key Reasons Cyber Protection is Essential for Enterprises of All Sizes:
- Everyone makes errors when it comes to safeguarding an organization’s data, and even intelligent individuals can act irrationally.
- Cybercriminals are constantly devising new methods to deceive your employees into unwittingly collaborating with them.
- The majority of hacks and security violations are committed by disgruntled employees.
- Cyber insurance is a requirement for many organizations in supply chains as part of a compliance checklist for vendor businesses.
- Even the largest firewall in the world will not protect your system from intruders.
Using a combination of technology, processes, and people, you can protect your business from some threats, but you can never eliminate them entirely. Cyber insurance is prepared to pick up the pieces at this point.
How to Obtain Cyber Insurance?
Cybersecurity insurance is readily available from the majority of business insurance providers. Many business insurance providers offer cybersecurity or data breach insurance as an add-on option to their business owner’s policies, but this may not provide sufficient coverage for businesses with more complex requirements.
To determine the estimated cost of cybersecurity insurance for your company, it is recommended to obtain multiple quotes from business insurance providers.
This can be done easily by using online business insurance companies or by working with a business insurance agent who can help you compare quotes and find the best coverage at an affordable price.
Cyber insurance is a crucial form of protection in today’s digital world. With the increasing number of cyberattacks, cyber insurance providers in Singapore offer a range of plans to meet the needs and budgets of businesses.
Cyber risk liability insurance protects businesses from the financial and reputational damage caused by data breaches and cyber attacks. The convenience of obtaining cyber insurance online makes it easy for businesses to secure this coverage.
It is important to remember that prevention is always better than cure, and with cyber insurance, businesses can have peace of mind knowing that they are protected against the unpredictable risks of the digital world.
Having cyber insurance in place can help mitigate the financial repercussions and reputational harm that can result from a cyber attack or data breach. By investing in cyber insurance, businesses can ensure that they are prepared for the unpredictable risks associated with conducting business in the digital age.