Digitisation has become the backbone of commerce around the world. Right from government organisations to individuals, everyone makes use of internet facilities. At such times, the security of the network is an essential task. You might believe that only large organisations are prone to attacks by cyber criminals, but that is not the case. Every individual using the internet service is susceptible to a cyber threat. Here’s where the concept of cyber insurance comes into the picture.
Cyber security insurance is the one that protects you from cyber-crimes which include data breaches that occur online, hacks email spoofing, phishing and malware attacks, and many more. All these cyber-crimes are targeted for either extorting money or with the intention of data theft. If you are an organisation that holds data which may include personal and sensitive information, such attacks may bring a legal liability to compensate for such data theft. Thus, availing a general insurance policy to protect against such internet-based attacks is the need of the hour.
When you are shopping for a cyber insurance policy, like health or motor insurance, there are many different alternatives to choose from. Selecting one among the many can be confusing. To simplify it for you, this article mentions the various things that must be considered to avail a comprehensive coverage that checks all the right boxes for you:
- Evaluating your risk exposure
The primary step in choosing a cyber insurance policy is to evaluate the risk associated with the data for which you are a beneficiary. For instance, a financial institution may hold critical payment-related information in form of login credentials, credit/debit card details and the like. With a theft or leak of such data, it can attract legal liabilities from the owner of such data. Thus, it is essential to determine what kind of data you possess and its risk exposure.
- Understanding the extent of liability
Considering the risk exposure of the data you or your organisation possesses, the extent of liability can be determined. Keeping that in mind, you must estimate how much coverage you should opt for in the event a cyber-attack takes place to cover the costs of the damages.
- Policy coverage offered
Before you finalise on a policy, it is essential to look at the cyber insurance coverage. This will help you understand what is covered and what isn’t. This involves going through the policy terms thoroughly that specify the exact coverage of your cyber insurance policy. With information about the scope of your policy’s scope, it can help you know which cyber events are exactly covered by the insurance company. Further, some popular coverages to look for in a cyber insurance policy are identity theft, social media liability, cyber stalking, malware attacks, IT theft loss, phishing attacks, email spoofing, medial liability, cyber extortion and privacy and data breach.
- Deductible and its impact on the premium
When you purchase a cyber insurance plan, it is essential to not overlook the deductible component. Deductible is that amount which the policyholder, i.e. you need to bear before the insurance company covers for the loss. The higher the deductible, the lower is the premium, but it requires a higher out-of-pocket expense during a claim. Thus, it is advisable to choose a plan with a limited amount of deductible so that it doesn’t become a burden at the time of claim.
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With these pointers, you can ensure to avail a comprehensive cyber insurance coverage to protect yourself against the various cyber risks that prevail in a digital-first world. Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms and conditions, please read sales brochure/policy wording carefully before concluding a sale.