As unfortunate as it is, all businesses function in an active and ever-changing threat landscape. Smart business owners stay prepared with a cybersecurity plan, and many are turning to insurance to mitigate the impact should something unforeseen happen. Cybercrime is a fast-growing business segment, and it’s no wonder, since businesses use systems that store more data that has value to criminals, held in sophisticated, complicated networks. While insurance is a good idea for any business, the industry has changed with the times. An insurance policy may protect your company from liability and risk, but it is also written to help protect the insurance company.
Remember not so long ago when people didn’t lock their houses and cars? Now it seems like everyone has tightened up their security. That’s because the world can be a threatening place, and it’s compounded by the fact that, in our litigious society, many people are looking to sue when they feel they have been exposed to wrongdoing. We’ve all become experts in personal security, and it all comes down to risk and risk management.
Insurance policies covering cybersecurity, networks and hardware, and valuable, proprietary data may cover network downtime and lost business time, the costs of dealing with cyber-extortion, and even insulate you from liability claims for privacy violations due to a breach to your network. Policies may also cover digital forensics investigations and consulting fees for cybersecurity experts to help with damage control.
Just as you invest in ways to ensure your business is protected, insurance companies do the same thing by writing their policies to protect them from customers using risky practices or outdated security measures. As with any insurance policy covering anything, the insurance company uses the language of the policy to make stipulations to the policyholder about how business should be conducted. The problem is, understanding what you need to remain in compliance with that policy can be a little cumbersome.
“A policy will spell out what the insurance company expects a business to do to protect itself,” says Darryl Kalli, principal of Northstar, Inc. “We can decipher their stipulations, so you fully understand what you’re signing. There may be some negotiable points that can help reduce the costs of that policy.”
Don’t leave anything to chance. Have us review your new insurance policy before you sign and make recommendations. We can help you train your team on best practices for cybersecurity, write your internal cybersecurity policy and disaster-recovery plan, and document your business compliance so you can get better premium rates. After all, the chances your insurer is going to have to pay out will have just dropped. And so will your premiums.