The relative merits of cyber insurance have been bandied about in articles and blogs of late. In some ways, this focus on cyber insurance is a bit puzzling; there are many flavors of risk, such as those to our health, lives, homes, automobiles, and organizations (among others). Except for some lines of coverage, insurance is optional; yet people weigh the risks, assess the consequences should a worst-case scenario strike, and decide if purchasing a policy is in their own best interest.
In a fundamental way, cyber insurance is no different at its core. In increasing numbers, organizations purchase policies to hedge their bets against the possibility of a significant cybersecurity incident, so they have the financial and logistical means to regain operational efficiency and recover quickly.
Looking at the numbers, it’s relatively clear to see that, for a growing number of organizations, cyber insurance is proving to be one answer to a very complex set of problems. More and more organizations are accepting cyber insurance’s critical role in transferring risk in the event of a major incident. Perhaps this is due to the soaring costs of cybercrime: the annual costs of worldwide data breaches are expected to surpass $5 trillion by 2024, with North American businesses taking the main force of the hit, according to recent studies. When balancing risk and expense, many companies are likely to conclude that (as with other lines of insurance) having a policy is an essential safeguard against what could be a business-ending event.
Cybersecurity services providers involved in incident response typically have an end-to-end view of breaches and their aftermath. We see a full range of or ..
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