Protecting your assets should not be limited to using cyber insurance alone. The increasing cybercrime rates make it prudent for the IT industry not to rely solely on cyber insurance but to employ additional online security measures. No one is disputing its importance, but it should not be treated as the only solution. It should be just one part of your security risk management.
Cybercrimes are projected to inflict annual damage totaling $10.5 trillion by 2025. Cybercrime data gathered by Comparitech shows:
- There were 153 million new malware samples.
- 2019 data showed that 94% of malware can evade detection by actively changing its code.
- More than half of previously infected consumer and business PCs got re-infected.
- 85% of organizations in the Cyberthreat Defense Report were victims of cyberattacks.
Cybersecurity Insurance Will Not Always Pay
Getting cyber insurance does not always guarantee that everything will be paid for in the event of a cyberattack. Like traditional insurance, there are specific provisions in cyber insurance that can free the insurance company from liability. It is important for any IT consulting company to familiarize themselves with the common cases that result in cyber insurance claim denials Here are some of the grounds used by cyber insurers to deny coverage:
Failure To Maintain Minimum Security Standards
The failure to maintain minimum security protocols can be grounds for claim denial. Cyber insurers consider it negligence on the insured’s side to have no adequate security measures in place to prevent a cyber-attack.
Social Engineering Fraud
Cyber-attacks related to social engineering schemes — such as phishing — can be a cause for denied claims. Indeed, cyber insurance policies are still adapting to provide better insurance coverage for social engineering fraud. Still, most insurance companies have ways to deny coverage for such cases.
Cyber extortion and ransomware have become more rampant in previous years. Cyber insurance companies may release claims for this type of cyber-attack, but the amount of coverage is where it gets tricky. A cyber insurer may reimburse the ransom demand, but depending on the policy’s terms, they can deny claims arising from indirect effects of ransomware, such as loss of income.
Companies must ensure they understand the terms of their cyber insurance policy. Reviewing the details can equip them with knowledge of what is within and outside their insurer’s coverage.
Human Error Falls on Your Company
Human error as a factor in a security breach may not be covered by cyber insurance. In the case of the Cottage Health System data breach — where thousands of confidential information such as medical records were accidentally published online — they were denied the claim due to human error and a lack of basic security controls in place.
It is crucial to analyze the third-party vendors that your company is partnering with. This is an essential step in making sure that you are entrusting your company’s security protocols and procedures to a reliable IT company. Check if your company’s third-party vendor complies with current cybersecurity and safety standards. This should minimize your risk of a successful cyber-attack.
Do not Rely on Cybersecurity Insurance Alone
Given the unending forms that cyber-attacks are made from and the inadequacies of relying on cybersecurity insurance alone, companies are well-advised to ensure that appropriate security measures are in place to heighten protection from cybercrimes and attacks. Here are some actions that can be undertaken to lessen vulnerability to attacks.
Consistent Employee Security Training
Train employees in best practices for online security to equip them with the knowledge to prevent online attacks such as social engineering schemes. An employee aware of online vulnerabilities will be able to spot a potential cyber-attack before it happens.
Update Systems and Apps
Keeping up with the latest version of systems and apps and making sure that they are up to date are the keys to effective security risk management. Always check that they are running properly to further mitigate any susceptibility to cyber-attack.
Often, it just comes down to the basics. Never underestimate the power of a strong password. Make it a habit to create passwords with a combination of alphanumeric characters and uppercase and lowercase letters.
Stay in Compliance with IT Security
Provisions Group can help your company’s IT security needs and requirements. We have two decades of industry experience and offer excellent IT staffing and recruitment, software development, and consulting services. Provisions Group has years of IT knowledge and experience to help your business keep information secure and protected from cyber-attacks.
Cybersecurity insurance alone is insufficient to protect your company’s critical information and data. It should not be treated as the only solution for all your security risk management needs; it is more of a complement to online security measures that should be put in place.
If you are looking for an IT staffing and recruiting company that can provide you with people trained in cybercrime prevention, then look no further than Provisions Group. We are a consulting and software development company that covers all your company’s IT requirements. Reach out today.