Many organizations incorrectly label cyber insurance as a luxury purchase rather than a necessity. In fact, a recent survey conducted by insurance experts found that nearly 60% of small and midsized companies don’t have any type of cyber insurance. What’s worse, less than 30% of those companies feel inclined to purchase a such a policy in the near future.
Despite these startling statistics, it’s vital for organizations of all sizes and sectors to secure adequate cyber insurance. Here’s why:
- You can’t afford a lack of protection. A single cyber incident can cost your organization millions of dollars in recovery expenses, business interruption costs and legal fees, which—without an insurance policy in place—could cause financial devastation.
- Cyber attacks are common. Don’t assume that cyber incidents are a rare occurrence. Especially as cyber criminals become increasingly sophisticated and organizations continue to digitize key business operations, data breaches have become a top threat—making cyber insurance all the more critical.
- Coverage is a contractual requirement. Many clients, vendors and suppliers include cyber insurance as a requirement in contractual agreements. In other words, securing cyber insurance is crucial to maintain your supply chain and ensure solid customer relationships.
- Noncompliance can be costly. In the event that you violate state, federal or international data protection laws, the resulting fines can be significant. Cyber insurance can assist you with these costs.
For additional guidance on how to mitigate your organization’s cyber exposures, contact us today.
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