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Why Businesses are Getting Uncompetitive – Cyber Insurance: A Cybersecurity Perspective

Posted by Jesse Hill 13-06-2024 04:02 PM

Businesses are increasingly seeking to insure their digital premises against threats and unexpected incidents, especially as much of life and work now unfolds online. What’s driving this trend? In essence, it’s the rising number and sophistication of cyber threats.
 

However, SMBs are encountering challenges in finding competitive cyber insurance coverage. A significant reason for this is not only their internal cybersecurity posture but also the broader evolution of the cyber landscape, encompassing both threats and defences.

So, what are the primary drivers behind this trend, and how can businesses position themselves for competitive coverage today?

Poor cybersecurity measures
One major factor contributing to uncompetitive cyber insurance offers is inadequate cybersecurity. Insurance companies evaluate risk based on a company’s security practices. Without robust defences, a business is perceived as high-risk, resulting in higher premiums.

Increase in phishing attacks and ransomware
The rise in phishing attacks and ransomware incidents has a significant impact on insurance premiums. By implementing cybersecurity measures directly addressing these threats, businesses can mitigate risks and potentially reduce insurance costs.

Lack of proactive risk management
Cybersecurity demands a dynamic, ongoing approach. Businesses failing to demonstrate continuous improvement in their cyber defences are deemed higher risks by insurers because what’s secure today might not be tomorrow. Systematically improving security across people, processes, and technology is crucial.

Neglecting cybersecurity hygiene
Daily cybersecurity practices are vital for maintaining a company’s cyber health. Insurers seek practices like proactive patching, robust password management, cleanup of old accounts, and multifactor authentication (MFA) when setting premiums.

Accessing competitive cyber insurance premiums with strong cybersecurity
To secure competitive cyber insurance, businesses must
demonstrate a serious commitment to cyber risk management. Here are some steps they can take:

  • Partner with a cybersecurity company: Engage a cybersecurity firm to thoroughly secure their business and validate this to insurers.
  • Implement comprehensive security measures: Deploy firewalls, antivirus software, and intrusion detection systems.
  • Conduct regular security training programs: Train employees to recognize and respond to cyber threats effectively.
  • Develop and test incident response plans: Regularly test robust incident response plans to ensure the business can swiftly address cyber incidents.
  • Maintain good cybersecurity hygiene: Adherence to regular updates, strong password policies, and MFA significantly enhances a company’s security posture.

By addressing these factors within your business, you increase the likelihood of securing excellent insurance coverage and ensuring business continuity as our world continues to embrace technological innovation.

 
Jesse Hill. Tier 3 I.T. Solutions
https://tier3it.ca/