With high profile denial of service attacks and data breaches becoming more common, it is in every company’s best interest to look into cyber risk insurance. The insurance will not stop the cyber attacks, but it will give the company the means to recover from the damage done during the attack by offering a financial resource to use after the attack occurs. This insurance is made up of two parts: first-party response and third-party response.
The first-party response part of the policy helps the company deal with the immediate fallout from the
cyber attack. This could include the following:
- Offering customers assistance in monitoring credit reports
- Reimbursement for hardware or software damaged during the attack
- Public relations efforts
- Determining who conducted the attack and how it was done
Third-party response covers any liability the company might have. This liability can come from lawsuits, copyright violations or privacy violations, to name a few. In many cases, cyber attacks do not destroy a company, but the lawsuits that come afterwards do.
Cyber risk insurance should be viewed as a requirement for any company with a web presence. With more companies suffering high profile attacks every day, there is no reason to believe any company is safe. Insurance is there to help companies ride out the storm. Take advantage of it.