The Importance of Cyber Insurance For DC Metro Area Organizations

Key Points From The Article 

  • There will be an increase in ransomware attacks in 2022.
  • More businesses are purchasing cyber insurance policies to protect their infrastructure and data.
  • Cyber insurance is essential for DC Metro Area organizations, given that it helps with data breach coverage,  reimbursement of losses as a result of business disruption, forensic support, legal support, and cyber extortion defense.
  • Businesses that have cyber insurance policies are not necessarily targeted by threat actors.

Headlines about ransomware attacks, data breaches, and other forms of cyber-attacks flood the news every other day. In 2021, we experienced a major uptick in cyber incidents, and the forecast for 2022 doesn’t look promising either. According to IBM, we will start seeing an increase in triple extortion (when a given business becomes a ransomware attack victim, its partners also face the threat of extortion) ransomware attacks in 2022.

Because of this, more and more businesses are raising the serious question of what measures they should take to mitigate the risks and improve their chances of surviving an attack. One great place to start is purchasing a cyber insurance policy. In this post, we will define what cyber insurance is and give reasons why it is important for DC Metro Area organizations.

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What Is Cyber Insurance?

Cyber insurance is a form of cover designed to protect businesses from cyber threats, such as malicious cyber hacks and data breaches. Having a cyber insurance policy can help reduce business disruption during a cyber event, and its aftermath, as well as potentially cover the financial costs of various elements of dealing with an attack and recovering from it.

Why Is Cyber Insurance Important?

When cyberattacks like hacks and data breaches occur, they can result in devastating damages. Businesses have to deal with disruption, litigation and lost revenue.

That said, it is crucial to remember that no business, regardless of its size, is immune to cyberattacks. As a result, cyber insurance has become an essential element of any risk management program. A cyber insurance policy is tailored to meet your business’s specific needs and can provide several important benefits, including:

1. Data Breach Coverage 

Organizations are mandated by the law to notify the affected parties in the event that a data breach occurs. This can add to the overall cost of a data breach, particularly as they relate to identity theft protection for those affected by the breach, security fixes, and protection from potential legal actions. A cyber insurance policy covers these exposures. As such, it helps safeguard your data from cybercriminals.

2. Reimbursement of Losses That Emanate From Business Disruption 

Cyberattacks often result in IT failure, which disrupts your business’s operations. When your systems are down, it means that you can’t undertake core business processes. This can cost your business both time and money. Most cyber insurance policies cover loss of income during these disruptions. Some policies even go-ahead to cover increased costs of your business’s operations following a cyber incident.

3. Forensic Support 

Following a cyberattack, your business will have to conduct a forensic investigation to determine the extent of the breach and what led to it. The costs associated with conducting this task can be exorbitant and can therefore inflict further financial injury to a business when it already has other costs of cyberattack to deal with.

The right policy should reimburse the insured for the costs related to forensic investigations and seeking out expert advice. Moreover, it should provide round-the-clock support from cyber experts, which can be especially helpful following a data breach or hack.

4. Cyber Extortion Defense 

Malicious software such as ransomware is usually designed to steal and withhold an organization’s sensitive data until a ransom is paid. As such attacks increase in severity and complexity, it is vital that organizations seek cyber insurance because it can help them recoup losses related to cyber extortion.

5. Legal Support 

If your organization falls victim to a cyberattack, it could be exposed to claims from customers who are affected by the cyber incident. Even a basic virus could result in loss of client data and consequently result in fines or prosecution.

As such, following a cyber incident, most businesses seek legal assistance. Acquiring such legal help can be costly. A cyber insurance policy can help ensure that your business affords proper legal representation, which will help it minimize fines and avoid prosecution.

6. Coverage That Transcends General Liability Policy 

General liability policies usually don’t protect organizations from losses related to data breaches when, in fact, data can be more valuable than physical assets. Therefore, it is important to have the right data protection policy in place when you most need it. Supplementing your general insurance with cyber insurance can give you the peace of mind that in the event of a cyber incident, your organization’s reputational and financial well-being is protected.

Are Businesses With Cyber Insurance Policies More Targeted by Cyber Attackers?

Given that cyber liability insurance is a relatively new concept, there are still a couple of misconceptions about it. The most common amongst them claims that businesses with cyber insurance policies face cyberattacks frequently.

This misconception is rooted in the belief that threat actors know that an organization has a policy before launching an attack. Even so, the fact of the matter is that there is no way for cybercriminals to obtain that kind of information. There isn’t a list of cyber-insured organizations for the public to view. At best, the threat actors can only find out that an organization has a cyber insurance policy after they have carried out the attack.

Moreover, even if threat actors were aware that an organization had a cyber insurance policy, that would only deter their interest in carrying out the attack. This is because, if anything, a cyber insurance policy only signifies that the organization is serious about its cybersecurity.

Wrapping Up

Today, as we continue to see a rapid increase in cybersecurity threats, more businesses are prioritizing cybersecurity and cyber insurance as a way of mitigating potentially crippling risks that cyberattacks pose. Even so, the challenge is understanding what cyber insurance offers, how it can be secured and what it covers. When you partner with a proven IT security provider, they can help you acquire an excellent cyber insurance policy that ensures your business’s continuity in case of a cyber incident.

Orion Networks Is the Right Choice for All Your IT Services and Support Needs

At Orion Networks, we understand that it can be difficult for organizations to find the right cyber insurance given the increasing complexity of cyber insurance applications. Orion Network IT experts can not only help protect your business from cyberattacks but can help you secure an excellent cyber insurance policy that will ensure your business’s continuity.

What’s more, we offer other premium IT services, such as IT Consulting, IT Engineering, Network Administration, Microsoft Azure Services, among others. Contact us today to get started.