What is Cyber Risks Insurance?

As Artificial Intelligence Companies make news headlines around the world, and stories are published indicating there is a perception that new technologies will be used to enable and further cybercrime, a concern is starting to emerge that businesses are more vulnerable that ever before to digital risks. While a sensible investment in IT infrastructure and Network security are always going to be the starting point for protecting against digital risks, the unfortunate truth of the emergence of new technologies means it is impossible to be wholly prepared for the potential cyber events of the future.

Cyber Risks Insurance exists to bridge the gap between existing security systems and the possibility of what might happen in the future.

Understanding Cyber Risks Insurance

Cyber Risks Insurance is a form of Business Insurance protection that is normally purchased as standalone protection in addition to other corporate risk management solutions. Cyber Insurance, also known as Digital Liability Insurance, or Cyber Events Insurance, is a form of coverage designed to protect organizations against unexpected losses that occur from a cyber-attack.

Many Cyber Insurance policies are tailored to the business or company obtaining cover, with most underwriters building the policy for the customer to reflect the nature of the risks they face. This means that Cyber Risks Insurance products can be extremely broad in their scope of coverage, and can provide financial protection against things like:

·?????? Website and Network Vandalism

·?????? Business Interruption costs associated with a cyber event

·?????? Losses associated with cyber threats

·?????? Costs of privacy notification and regulatory compliance following an event

·?????? Crisis management support

·?????? Ransom and Reward Expenses

Businesses have the opportunity to create bespoke cyber insurance solutions with which to insulate themselves from exposure to digital risks. However, it is important to note that the cost of a cyber insurance plan will depend on a number of factors, including:

·?????? Annual Revenue of the business

·?????? Industry in which the company operates

·?????? Annual Policy Limits

·?????? Scope of Cover

Simply put, choosing to obtain a Cyber Insurance policy with a high level of coverage against all possible risks, will cost more than choosing to purchase a plan that only provides a limited level of network vandalism protection.

Why Consider Cyber Insurance?

Two years ago, the idea that AI would have a fundamental impact on every day business operations would have been considered amusing (at best) by most companies worldwide. Today, AI is influencing buying decisions, client interactions, marketing materials, and even corporate accounts. AI is a tool, and can be a tool with multiple uses, some of which have not been found or identified yet.

Whatever dangers are inherently contained in a tool like AI, the truth is that it is a tool which did not have widespread forewarning of its uptake before it simply arrived and began to make an impact on communities and markets across the globe.

This is the internet.

Trends and technologies come and go quickly. Whatever tools are being used today, there is no guarantee that they will be in use tomorrow. What is guaranteed is something new. Recently, criminals successfully attacked Las Vegas Casinos, and were able to steal a large amount of data from Genetic Services companies – two examples of the many tens of thousands of malicious cyber events which have occurred in 2023. While a company may have not been on the receiving end of a cyber-attack, there is no guarantee that they will remain free of the attentions of cyber criminals. Although not all cyber-attacks are going to be successful, they don’t need to be successful. Cyber criminals operate in volume, and it only takes a single event to significantly impact a business’ operations – or completely take a company offline.

The problem is that it is not known, or fully understood, what the next thing in technology will be. So, while organizations can protect themselves today, planning for the future and creating a comprehensive blanket of insulation against potential cyber threats is virtually impossible. Especially when considering that this is a primary concern for cyber criminals everywhere – what is the next vital tool that builds on the work of social engineering, phishing, and even ransomware?

Cyber Insurance Working for Business

A Cyber Insurance policy is not going to prevent a cyber event. However, the existence of a cyber insurance plan ensures that a company is well positioned to overcome the obstacles presented by a cyber-attack or other malicious cyber event.

For example, depending on the industry in which a company operates, there may be data and privacy regulations that dictate a specific response to a cyber event. Dealing with privacy notification regulations, especially in the aftermath of a cyber-attack, will be time consuming and expensive. A cyber insurance policy may be able to provide a crisis response team to assist with managing your regulatory responsibilities, or cover the costs of any fines that may be associated with a breach of applicable regulations.

For companies in the Financial and Healthcare sectors this can be of critical importance simply due to the sheer volume of attacks they experience from determined attackers. But for any business, especially in an age where companies rely on the internet and web connected tools to operate, falling victim of a cyber attack can often cause irreversible harm without the financial support and knowhow offered by a comprehensive cyber insurance policy.

CCW Global Business Insurance

CCW Global Limited has over a decade of experience in assisting Hong Kong and Asian business cover their digital risks. Our expert advisors work with key stakeholders and decision makers to empower the organization to make an informed decision on the coverage that best fits the company’s needs. By providing benchmarking and analysis, CCW Global brokers are able to assist in ensuring your risk management toolset is as effective as possible; and covers you against the risks you expect.

As a full-service brokerage, CCW Global is able to offer a range of business insurance solutions under a single roof, including: health insurance, worker’s compensation, professional liability, and many more corporate insurance options.

For more information about Cyber Insurance, or to find out how CCW Global can provide free assistance with your corporate insurance, please Contact Us Today.

Ask CCW – We’re Simplifying Your Insurance.