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Five Tips for Companies Considering Cyber Insurance

by John A. Wheeler  |  March 2, 2015  |  8 Comments

As cyber attacks and data breaches are surfacing on a daily basis, our clients are looking for ways to mitigate the risk associated with these events. One of the most popular methods being explored is the use of cyber insurance. But, just what is cyber insurance?

Gartner defines cyber insurance as protection against losses related to cyber-risks, such as data theft/loss, business interruption caused by a computer malfunction or virus, and fines or lost income because of system downtime, network intrusion and/or information security breaches.

As a result of many recent highly publicized losses related to cyber security risks, interest in cyber insurance continues to grow. In fact, our recent 2014 Global Risk Management Survey showed that half of the companies surveyed are currently exploring some form of cyber insurance.

For those companies who are currently considering the use of cyber insurance, we offer the following five tips to find the right policy and to maximize the value of the coverage obtained.

  1. Don’t look to cyber insurance as a panacea for a weak IT risk and security program. To qualify and to obtain reasonable premiums, companies must have a strong security posture.
  2. To determine the true value of the policy, look beyond the quote to examine the policy language.
  3. Ask the broker/carrier about their history of paying claims and to provide specific examples.
  4. Complete the policy application thoroughly and truthfully – any inaccuracies may render claims invalid or provide an opportunity for the insurer to void the policy altogether.
  5. Reevaluate your IT risk and security program as well as any policy changes on an annual basis to ensure adequate coverage.

To learn more, read “Understanding When and How to Use Cyber Insurance Effectively” or see our latest research on cyber insurance at gartner.com.

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Category: cyber-risk  cyber-security  cyberinsurance  digital-risk  enterprise-risk-management  information-technology  it-risk-management  operational-risk-management  risk-management  security-of-applications-and-data  third-party-risk-management  

Tags: big-data  cyber-insurance  cyber-risk-2  cyber-security  data-breach  digital-risk-2  gartner  information-security  it-risk-management-2  it-security  risk-management  social-media-risk  

John A. Wheeler
Global Research Leader - Risk Management Technology
8 years at Gartner
30 years IT Industry

John A. Wheeler is global research leader for risk management technology solutions and professional services. His areas of specialty include integrated risk management, executive leadership and corporate governance. Follow him on Twitter @JohnAWheeler Read Full Bio


Thoughts on Five Tips for Companies Considering Cyber Insurance


  1. Mazid Umar says:

    Hello,

    Wow nice article.These tips really helpful for me and all newbie .You described all tips in very well manner. I will share this useful tricks with my all followers. I would like to see some more intrusting post from your side.

    Regards,

    Mazid Umar

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