Why are Organizations buying Cyber Insurance?
While there are many reasons why organizations are and should be buying cyber insurance, we offer two reasons:
1. Organizations are reading the daily headlines and are more aware of the threats that are happening on a daily basis and that there’s a price to pay when they lose their customer’s sensitive data. Whether it be damage to reputation or a potential lawsuit, penalties/fines or loss of customers/income/sales, when a data breach happens organizations need to already have a plan in place. Cyber insurance helps put a plan in place.
Risk Tip: Organizations today need to have an Incident Response Plan and don’t want to be making things up on the fly. Having a cyber insurance policy offers organizations a team of professionals who stand ready to help respond to a breach or security incident.
2. Secondly, there are more contractual obligations today that are requiring their independent contractors purchase cyber insurance in order to fulfill contract requirements. We see a lot of this when working with service providers who have access to a third party’s customer database and or network, regardless of whether or not they are handling any sensitive customer data.
Risk Tip: If an organization contractually agrees to indemnify their client for data breach costs, they better check their cyber insurance policy before agreeing to indemnify the other party to check to make sure they have coverage. Some policies offer coverage to the extent such costs would have been paid had costs been incurred by them.
CYBER DATA RISK MANAGERS LLC is an Independent Insurance Agency specializing in Cyber Security and Data Breach response insurance. We offer solutions that help you quickly respond to cyber events and data breaches as well as to plan in advance for their occurrence. Given the ever changing nature of information assurance and compliance, you don’t want to be caught unprepared.
For assistance with your customized insurance proposal, call 1-(855) CUT-RISK Toll Free -or- complete the form below.