Cyber is a risk that cannot be insured unless the insured takes on more risk

Cybersecurity is a hot topic in today’s digital age.

With the increasing reliance on technology and the internet, businesses and individuals are at risk of cyber-attacks and data breaches.

Unfortunately, many people assume that their insurance policies will cover them in case of a cyber incident.

However, the reality is that traditional insurance policies may not provide adequate protection against cyber risks.

The main reason for this is that cyber risks are constantly evolving and new threats are constantly emerging. As a result, insurance companies are often unable to keep up with the latest developments in the field.

Furthermore, many insurance policies have exclusions or limitations when it comes to coverage for cyber incidents.

This means that even if you have insurance, you may not be fully protected against a cyber attack.

So, what can you do to protect yourself against cyber risks?

One option is to purchase a standalone cyber insurance policy.

These policies are specifically designed to provide coverage for cyber incidents and typically include coverage for things like data breaches, cyber extortion, and business interruption.

However, purchasing a standalone cyber insurance policy also means taking on more risk.

Many standalone policies have high deductibles and exclusions, which means that you may still be on the hook for a significant portion of the loss in the event of a cyber incident.

Another option is to take a proactive approach to cybersecurity.

This can include implementing strict security protocols, regularly updating software, and training employees on how to recognize and prevent cyber attacks.

By taking steps to reduce your risk, you may be able to negotiate more favorable terms on your insurance policy.

In short, cyber risks are a reality that cannot be ignored.

While insurance can provide some protection, it is not a silver bullet.

Businesses and individuals need to take a holistic approach to cybersecurity, including both insurance and risk management measures.

And remember, just like a good lock on your front door, being proactive can keep cybercriminals at bay.

Posted in Compliance, Policy and Governance, Resilience and Detection, Risk Management and tagged , , , , .

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