With the increase in Ransomware globally, companies are now turning towards Insurance Cyber-security covers and ensuring they are covered against threats of having a connected world. Every single day, cyber-attacks as becoming more sophisticated and hi-tech exposing companies to high risks like never before. More infrastructure penetration is taking place in the financial sphere. Blockchain technologies of the financial sectors not being left behind. The hacks and public opinion manipulation of the social and mass media have created a new way to earn money illegally. Traditional card fraud, ATM malware automation, State-funded attacks against financial institutions are all on the all-time high.
All this have created the need for Insurance policy cover against Cybersecurity. Insurance companies have seen the need to come up with a policy to cover people and institutions against cyber-attacks. Coverage is for people and institutions that fall victims of cyber-attacks, cyber-bullying, and cyber-extortion. The policy covers against financial loss, IT theft loss, prosecution costs, and restoration cost due to any malware attack or identity theft.
Companies are now demanding for tailor-made insurance products that take care of any fallout that results from cyber-attacks. Insurance companies are now creating Cybersecurity Insurance policies that not only cover compromised system losses but any other thing that is a result of the hacking.
Every 40 seconds, a company somewhere on this globe is hit by Ransomware. Ransomware is a malicious malware that is sent to a company’s system by hackers to lock the system and access is only granted once the ransom is paid out. This software is readily available to criminals on demand hence the popularity of its use. 2017 saw an increased trend in the use of Ransomware on high-profile attacks like Petya and WannaCry. The losses from this two alone are estimated to be $300 Million and $4 Billion respectively.
Today, cybersecurity is one of the most discussed topics in the boardroom. This has led to a huge demand for cybersecurity insurance as cyber risk is rising at a very fast pace in dynamic and explosive ways. Comprehensive cyber insurance is important for any major e-commerce or start-up business. Cybersecurity policies are expensive and generally, have many complications of ifs and buts. So there is a lot of noise I the market about them than the actual market size.
Premium payments for this insurance policy covers are calculated based on business type, cybersecurity ability of the firm, data subjects’ nationality, the scale of data the firm handles, and the amount of the cover purchased.
In the next few years, cybersecurity covers will be required by every person so it is possible for the premiums to be more affordable in future. For now, cybersecurity for organizations remains expensive due to the high costs that come with a forensic probe. The institutions have to bear the risks.
However, the need to have a Cyber Insurance cover outweighs the cost of acquisition of the cover for institutions. The cover ensures that your losses are completely covered and it boosts the confidence of the institution to the clients as they are sure their finances are covered no matter what happens to the institution online systems. It is good to hope for best but are we prepared for the worst?