With cyber-attacks on the rise, and more sophisticated than ever, it has never been more important for businesses to consider purchasing cyber insurance. The costs of not doing so could be far greater.
Cyber-attacks more costly than ever
Data breaches and other malicious cyber activities can have devastating consequences, including costly data loss and reputational damage. The average total cost of data breaches in 2022 was $4.35 million, according to the IBM/Ponemon Institute report. The report also found that it takes an average of 277 days for security teams to identify and contain a data breach.
Nearly two in three midsize organizations have suffered a ransomware attack in the past 18 months. In fact, 47% of all U.S. businesses suffered a cyber-attack in some way in the past year. The average cost of those attacks were $18,000 in 2022, up from $10,000 in 2021.
Data security measures increasingly outdated
Cybersecurity measures in place by businesses, governments and individuals are increasingly being rendered obsolete by the growing sophistication of cybercriminals.
Businesses must take proactive steps in defending against these threats, or risk significant losses as a result of breached systems and stolen data. Cyber insurance is one such way organizations can protect themselves from financial harm due to a breach.
Your business could be liable in the event of a breach
If your business stores sensitive information like credit card numbers, Social Security numbers or protected health information, you could be held liable for any breach that may occur. A comprehensive cyber insurance policy can help protect against this risk, providing vital protection against financial losses related to data breaches and other cybersecurity issues.
Every business – large or small – must recognize the severity, and increasing frequency, of data breaches, and how quickly customer trust can be put in jeopardy as a result.
Why you need cyber insurance, now more than ever
Cyber insurance policies provide coverage for costs associated with restoring damaged systems, paying credit monitoring services for affected customers, customers compensation for financial losses due to the breach, regulatory fines and penalties, legal fees incurred during investigations concerning the breach – even public relations efforts associated with managing post-breach reputation fallout.
It can also help cover the costs of hiring experts to clean up the mess and upgrade your security. In fact, cyber insurance coverage also provides organizations with access to experienced professionals who specialize in data breach prevention and can help them put in place strategies for responding to threats more quickly.
Even if you're not required to carry cyber insurance, it's a good idea to consider it as part of your overall risk management strategy
Whether it’s a small mom and pop retail store or a mutli-national corporation, cyber insurance can give businesses peace of mind when it comes to mitigating cyber-related risks. If a business suffers a data breach, having cyber insurance in place helps reduce the financial and reputational impact that can result.
Insurance Professionals of Arizona have been ahead of the curve on cyber insurance, and can confidently help you find the cyber insurance policy that gives you the protection you need within your budget. Our IPA agents will go into detail on every policy option available, as well as how those policies work should a data breach, ransomware attack, or other security hack occur.
When looking at the various types of cyber insurance policies, business owners should consider what type of coverage is best suited for their particular needs. As part of any risk management strategy, cyber insurance can provide an important line of defense against attack vectors like malware or ransomware. For businesses that store sensitive customer data like credit cards or other personal information, cyber insurance should be seriously considered – even if they’re not required to do so by law or contractual obligation.
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