What Does Cyber Security Insurance Cover?
As a cyber security expert, you are the first line of defense against hackers. But what happens if the hackers outsmart you? Cybercrimes and data breaches are becoming way too common and can cause massive losses for both large and small companies. The losses may also come in the form of legal fees and other major fines.
A data breach can also manage your company’s reputation and put your customers and employees at risk. This requires organizations to come up with a risk management plan that will help in determining risks to avoid, control, or transfer. This is where cyber insurance comes in.
What is Cyber Security Insurance?
Cyber security insurance, also referred to as cyber liability insurance coverage or cyber risk insurance, is a type of insurance designed to cover organizations that use technology services or products. The insurance cover helps an organization mitigate risk exposure by covering a variety of losses that may result from a security breach or similar cybercrime. General liability insurance only covers property damage and bodily injuries and does not include cyber insurance.
Organizations are seeing a need for cyber insurance and before someone gets a cover for their business, it is imperative first to understand what is covered. Often, this type of insurance covers expenses related to first parties and third-party claims. What is covered by cyber insurance is a business’ liability for a data breach that involves customers’ personal information such as account numbers, credit card numbers, Social Security numbers, driver’s license numbers, health records, etc. This information gets exposed when hackers or other criminals gain access to the electronic network of an organization.
Cyber insurance covers a variety of expenses related to data breaches, including notifying customers about the data breach, costs to defense claims by state regulators, credit monitoring, recovering compromised data, restoring personal identities of the affected clients, fines and penalties, repairing damaged computer systems, and loss resulting from identity theft. Most states require customers to be notified of a data breach that involves exposure of their personal information. This can be a very expensive process.
Benefits of Cyber Security Insurance
If you’re wondering what are the benefits to a business having cyber security insurance, here are just some of the many. As a cyber security student it’s important to understand just how important your job is to protect this sensitive information from hackers.
Offsetting the expenses of a Data Breach
Data breaches are unpredictable and are therefore difficult to budget for. Each data breach varies widely depending on its size, scope, and complexity. For instance, when protected health information is breached, it can be very costly given the potential for fines from multiple agencies, strict notification requirements, and specialized medical identity monitoring and recovery services.
The cost of lost or stolen information has continued to rise. Many organizations have come to the realization that cyber insurance plays a crucial role in offsetting unexpected expenses resulting from a data breach. Typical data breach coverage includes data breach notification, legal fees, forensic investigations, data analysis, identity monitoring, identity restoration services, regulatory fines, public relations and legal settlements.
Providing resources for Data Breach Response
Most cyber insurers provide resources to companies facing a data breach. This can either be through a panel of approved vendors or informal referrals. Individuals who can be provided by the insurance company includes a breach coach and an attorney who offers guidance to the affected organization through the breach response process. They also seek to limit the legal exposure of the organization.
Referrals that may be provided for a range of service providers including legal and PR, data breach notifications, and forensics. When the insurer provides such resources, it offers the affected company much convenience since they don’t have to shop around for their own data breach services provider. Another great benefit that comes with using a carrier’s resources is experience. For instance, the legal counsel of the company may not have experience in the data breach sector.
The Role of Formal Education in Cyber Insurance
Cybersecurity experts play an imperative role in helping companies understand whether they have the necessary firewall or data loss prevention tool. Cyber security pros are the best line of defense against hackers and other nefarious characters who would breach company computer systems.
The experts have complex problem-solving abilities and creative minds. Because of the complexity of this career, most jobs in cybersecurity require formal education with a bachelor’s degree minimum. Recruiters and hiring managers are going to be looking for a degree on your resume. Be sure to get the education you need to do the assigned work and help keep businesses safe.
Are you interested in cyber security? Want to make a different for businesses large and small? If you’re interested in earning a Bachelor of Science Degree in Computer and Information Science with a Major in Cyber and Network Security - Cybersecurity Track, consider ECPI University for the education it takes to be an expert. For more information about this exciting degree program, connect with a friendly admissions advisor today.
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