With fresh hacking stories in the news every day, cyber risk insurance is on the minds of business leaders around the globe. But recent surveys on business responses to cyber threats suggest that business leaders in the U.S. are wildly ambivalent about the data breach and cyber risks they face.
The findings of recent surveys conducted by AIG and Zurich Insurance Co. Ltd., say it all:
- 85 percent of business executives are worried about cyber risk insurance coverage– that’s a greater percentage than those worried about property damage, income loss, or investment risk.
- 76 percent of corporate leaders are worried about information security and the privacy of their customers.
- Only 19 percent of companies actually have Cyber Risk Insurance.
- Only 16 percent of firms have a chief information security officer.
- Fewer than half (44 percent) of companies have actually altered their budgets to manage cyber threats.
How Can Cyber Risk Insurance Help?
While the majority of business leaders in the United States seem to be aware of the many cyber risks that threaten their businesses, few seem to know how to ease their fears. Some analysts suggest that business leaders are simply overwhelmed by the scope of the problem and by the speed at which cyber threats change and emerge.
Still, a lack of clarity about what steps to take is no excuse to take no steps at all: in addition to costing companies serious money, data breaches and other cyber threats can do long-term reputational damage, which many business leaders believe is more harmful to a firm’s ultimate stability.
As part of a comprehensive risk-management program, cyber risk insurance can provide funding for…
- Your legal defense.
- Reputation management and rebuilding efforts.
- Any settlements or judgments you’re found liable for.
In other words, it can protect you in case a data breach or other cyber incident happens. To prevent such an event, business owners need to reduce their cyber risk by implementing stringent password encrypting, updating, and protecting policies; limiting internal access to sensitive information; and using anti-virus software when appropriate.
Writtten by Brenna Lemieux - check her out at Google+ or Twitter