As cyber criminals continue their relentless attacks across the web, the importance of cyber insurance is ever growing. According to Digital Journal, the cyber insurance world is expected to grow over the next six years. For many organizations cyber insurance is one of the tools they deploy to help minimize the risk and impact of a successful cybersecurity attack. Having cyber insurance can help minimize financial risks to your small business if your business suffers a significant cyber attack
What is cyber insurance
Cyber insurance is similar to other insurance policies you can purchase to protect your small business. These policies focus on cybersecurity, your technology, and your data. Cyber insurance is also an independent policy that focuses solely on cyber. Some of your other small business insurance policies may have cyber clauses, but these are usually not enough to protect your business fully.
How can cyber insurance help my small business
According to the Federal Trade Commission (FTC), there are two types to consider, First-Party and Third-Party insurance. The FTC defines First-Party insurance as: “First-party cyber coverage protects your data, including employee and customer information.” The FTC defines Third-Party insurance as: “Third-party cyber coverage generally protects you from liability if a third party brings claims against you.” Both kinds of insurance are worth considering as they play different roles in protecting your data.
It is important to know what data your small business has and how you use it. Maybe your business stores little to no customer data, so maybe third-party insurance is not as important to you. It is one of the first steps to take when starting your small business cybersecurity program and will be one of your guiding lights throughout the life of your small business. Knowing and understanding the data you have, better allows you to protect it and your small business!
There are several reasons to consider when shopping for cyber insurance and the reasons can vary from organization to organization. It is important that you speak to a trusted agent and understand all of your options before settling on a policy.
For more information on cybersecurity and protecting your small business, check out Small Business, Big Threat!