Modernisation has transformed business operations as a result of the future internet transactions, technology, and social media. It also creates loopholes for cyberattacks by hackers, nation states, insiders, and criminals. It can result in a severe loss to organisations hence a need for a risk management plan. The popular risk mitigation method is by insurance, and this is where cyber liability insurance cover (CLIC) comes in.
CLIC are interconnected and may seem similar with covers from existing products such as professional indemnity, coverage for business continuity and issues of a third-party supply chain. Although CLIC may overlap, a decent policy will ensure throughout cyber risks management.
1. Understand the covers
The technicality of the information regarding security and how to deal with data breaches may confuse users. The CLIC's market is still in its infancy. Hence, you should ensure the insurer understands your needs. It is crucial that you determine what costs to cover. You should also make clear the incidents you want to cover.
Discuss your list of requirements with the relevant people. List your costs and the cost which others may claim from you. In most cases, the preferred policy is stand-alone as it is comprehensive.
2. Selecting an insurance company
Choosing the right insurance company should be your primary goal. You may pay little but for a cover which will not help you, even when the insured incident occurs. Alternatively, you may pay much for protection which the insurer is ready to cover all costs suffered.
It is also vital that you compare the deductibles offered by various companies. Check on the coverage limits, whether they cover first party or third party. Countercheck on the coverage items list of the insurance company and compare with those of their competitor.
Businesses have different cybersecurity needs. It is, therefore, essential that you follow up and ensure you are well covered. Cyber breach is also a typical incident considering the increase of hackers. The only alternative to bankruptcy caused by the breach is getting a CLIC.