There are plenty of cyber risks out there – and the costs can be significant if you’re one of the unlucky businesses that experiences a cyber-related incident. More than 80% of UK businesses were victims of successful cyber attacks across 2021/22. Cyber insurance is a significant means of ensuring your business is able to recover after a cyber incident.
Cyber insurance is an essential part of being a digital business in today’s world. It’s a key way to protect your business against the fallouts of data breaches and other cyber risks. Unfortunately, the premiums are rising every year as cyber threats continue to grow.
However, there are some simple things you can implement within your business to reduce your premium.
Why do I need cyber insurance?
Cyber insurance is a type of business insurance that covers the cost of a data breach, including expenses related to investigating the breach and repairing any damage that results. With cyber insurance, you can mitigate the risk of a cyber breach by reducing your organisation’s attack surface (the number of vulnerabilities that make your company an attractive target for cyber criminals).
Cyber insurance provides financial protection against unexpected losses. It’s unique in that it covers a type of event that is largely unpreventable and unpredictable
While many types of business insurance have remained relatively unchanged over time, cyber insurance has had to evolve to keep pace with the ever-changing nature of cyber threats.
Why are premiums rising?
The frequency and severity of cyber incidents such as data breaches, ransomware, and cyber attacks has continued to rise, making cyber insurance premiums pricier than ever.
While it’s a good sign that companies are investing more in their cyber security efforts, it means that insurers are paying out more on claims. That, in turn, has caused premiums to increase by an average of 28% in the first quarter of 2022, compared with the last quarter of 2021.
Five ways to reduce your cyber insurance premium
1. Implement endpoint protection
Endpoint protection is especially important when your company has sensitive information on its computers and networks, such as medical records or customer data. Just one breach of these types of systems can cause major problems for your business and could cost you a lot of money in fines and lawsuits.
Therefore, it is important to take steps to keep them secure. With endpoint protection, you can lower your cyber insurance premiums while protecting yourself against the risks posed by cyber attacks.
2. Strong password management
Strong password management is one of the easiest ways for you to lower your risk of cyber attack. If your company stores data in a database, it’s likely that it uses some sort of authentication system to regulate access to that data. It’s important to make sure that your authentication system is strong enough to protect your data.
Although it may seem like a small detail, weak authentication is one of the biggest contributors to data breaches. Cyber criminals can breach your system by exploiting a weak authentication method and gaining access to your database. That’s why it’s important to make sure your authentication methods are strong enough to protect your data.
3. Data protection
Data protection is another thing that can lower your risk of a data breach. It’s important to make sure that the data you’re storing is encrypted. You also need to keep that data in a secure location so it’s not vulnerable to attack. There are a few ways you can do this, such as keeping your data on a private network or using a cloud-based service.
Even data that is sitting in a database or on a file server that’s behind an authentication method like SSH is at risk for a breach. Hackers could break into your database and steal information that way. Malicious insiders could also copy data from inside your database and take it elsewhere.
4. Implement an incident response plan
An incident response plan (IRP) is something that any company that handles sensitive data should have. It outlines steps that should be followed in the event of a data breach. The goal of an IRP is to mitigate the damage caused by a breach and prevent the breach from spreading further. With cyber insurance, part of the cost of a breach is covered by you, the insured party. However, you may have to pay extra if your breach is especially costly.
An IRP can help you deal with that breach in a more cost-effective way by reducing the amount of damage that results from the breach. Having an IRP in place can also convince your insurer that you’re taking your security seriously. In turn, they’ll be more likely to reduce your premium or offer other types of incentives.
5. Conduct regular penetration tests
Penetration testing is a method that hackers use to test the security of systems. In other words, it’s like them trying to break into your systems by trying various methods. Your security team can use the results of these tests to improve their defences and make sure their systems are secure.
Having a penetration test done is a great way to catch issues before they turn into a serious problem, like a data breach. It can also help you identify the weaknesses in your defences so you can patch them before they become a problem. Having a penetration test done on a regular basis can help you avoid a costly breach.
Lower your cyber insurance with expert assistance
While cyber insurance provides financial protection against the costs associated with a cyber incident, like hiring a forensic team to investigate a breach, it is not a substitute for good security practices and good IT hygiene. Implementing the right cyber security tools and practices will keep you secure against cyber threats, and help lower your cyber insurance premium.
The cyber security specialists at NetworkIQ can help you optimise your security posture, find the right cyber insurance for your business, and reduce the premium.