Business owners must be increasingly focused on issues surrounding cybersecurity.
A recent story at securitymagazine.com titled “Cyber Insurance Rates, Purchases and Coverage Are Increasing” should prompt those with a vested interest in cybersecurity to ponder the implications posed by the article. The article reports that “…there was a 27-percent increase in the number of U.S. clients purchasing standalone cyber coverage for the first time in 2015. The manufacturing industry saw the biggest uptick in new cyber purchases – a 63-percent increase over 2014”. That is a HUGE increase!
On the one hand we can applaud organizations…actually those in the C-Suite…for FINALLY recognizing the danger that hackers are posing to their business and ‘insurancing-up’. Hackers are costing businesses billions of dollars in losses….with some estimates going over a trillion dollars by the end of the decade worldwide.
On the other hand….this implies that leaders of organizations, large and small, no matter how large their cyber security budget, are now admitting that they no longer have confidence in their cyber defenses nor their IT personnel…..from the CIO/CISO to the lowest IT professional. Let’s face it, if you were confident, if you know your defenses were strong, if you believed your CIO/CISO when they looked you in the eye and said “Don’t Worry”…you wouldn’t need insurance…..right?
Also…in taking out insurance businesses are protecting themselves from anticipated loss and passing the loss on to the carrier, which makes sound financial sense, but in so doing will they now feel they can get lax in their cyber defense? Why bother with strong defenses…just check the required minimum box and call it enough! And…what about the customers? A business can be protected from loss, but what about the customer if the business fails to exercise due diligence and a customer’s PII is exposed for all the world to exploit? What protection does the customer have when involved with a highly insured and over confident organization?
Insurance has its place, but so does a vibrant cyber defense….and so does an old fashioned thing called business ethics.
Learn more about protecting yourself and your business at the National Cybersecurity Institute.
SecurityMagazine (2016, June 1). Retrieved from http://www.securitymagazine.com/articles/87134-cyber-insurance-rates-purchases-and-coverage-are-increasing