Why Skipping Security Awareness Training Could Invalidate Your Cyber Insurance

As cyber threats become more sophisticated, insurance providers are tightening their requirements. Increasingly, security awareness training is no longer just a recommendation—it’s becoming a mandatory component for full insurance coverage. Without it, your business could face gaps in your policy, leaving you exposed when an attack occurs.?

In this edition of 'The Sting of Security', we discuss why skipping security awareness training could invalidate your cyber insurance, and how businesses must adapt to meet new requirements from insurance providers.?

The Importance of Cyber Insurance??

Cyber insurance is a safety net that guards against responsibility and financial loss if a cyber attack against you succeeds. It is not that complex. Many businesses discover that the process of acquiring cyber insurance eventually involves comparing the cost of consequent premiums to the extent of a breach.??

When a company invests in cyber insurance, they are essentially buying three things:??

• A financial safety cushion to lessen the impact of a security breach;??

• Proof of due diligence on behalf of governing bodies – Showing that you’ve carefully followed the rules set by regulatory agencies;??

• Peace of mind for the company and the parties involved.??

A cyber insurance policy can protect the enterprise against cyber events, including acts of cyberterrorism (depending on the policy), and help with the remediation of security incidents such as:??

• Restoring personally identifiable information (PII);??

• Ransomware – Cyber extortion;??

• Network disruption.??

Marriott Data Breach??

A striking real-world case of the importance of cyber insurance is Marriott's massive data breach, which affected 383 million guests, exposing sensitive personal information, including unencrypted payment card data. Despite the severity of the breach, Marriott's out-of-pocket expense was just $1 million. The reason? Marriott’s robust cyber insurance policy covered $71 million of the $72 million total cost, demonstrating how essential cyber insurance can be in mitigating the financial impact of large-scale data breaches.

Security Awareness Training??

The strength of your organization’s complex and sophisticated passwords, multiple firewalls and anti-malware programs can be bypassed by exploiting the human factor and that will always be an issue in keeping your company and yourself safe. Employees are often the ones who are most vulnerable and need the right security awareness training, turning them into experienced observers, always on the lookout. Cybercriminals know that bypassing hardware defenses is difficult, but exploiting a person’s lack of awareness is much easier. This reality makes it crucial to equip your employees with the right tools—specifically, thorough security awareness training that helps them recognize and respond to threats.??

So, why invest in Security Awareness Training? It is simple: both cyber insurance and Security Awareness Training help reduce costs and liability. It adds another layer of protection, preventing the need to invoke your insurance. Contradictory, I know. But the logic is clear—better training reduces the risk of costly breaches and insurance claims.??

More than 90% of cyberattacks involve social engineering or phishing in one way or another. It shouldn’t come as a surprise that lowering the likelihood of social engineering and phishing attacks lowers the possibility of a breach, and security awareness training is the right tool to minimize this attack vector. It can be beneficial in more than one way:??

• User training??

• Positive Security culture??

• Compliance and Governance:?PCI DSS,?HIPAAISO/IEC 27001, FISMA, GDPR.??

How Hornetsecurity Can Help??

Hornetsecurity’s next-gen Security Awareness Service offers comprehensive, fully automated training to equip employees with the knowledge to combat evolving cyber threats. Through AI-powered spear phishing simulations and tailored e-learning modules, it ensures employees are prepared to protect themselves and the company.

Hornetsecurity is a market leader, and has won 2 awards in 2024, Fortress Cybersecurity Award, and Global Infosec Winners for its Security Awareness Service.??

Key features:

• Patented Spear Phishing Engine for realistic, AI-driven phishing simulations
• Automated, needs-based e-training tailored to individual employee needs
• Industry-unique Employee Security Index (ESI?) to benchmark security behavior

Hiscox offers users of Hornetsecurity's Security Awareness Service exclusive benefits and unbeatable all-round protection against hacker attacks and cyber incidents.

Remember, in today's landscape, no one is immune to cyberattacks—any organization, large or small, can be a target. The more layers of protection you have in place, the better equipped you are to defend against these ever-evolving threats.