Many companies will increasingly choose work from home in the future, which will increase the risk of cyber intrusions into corporate systems, thus increasing the need for protection. Insurance company Wiener Städtische osiguranje offers cyber risk coverage by advocating for stable and professional protection against possible financial problems for its clients.
Expectations are that the cyber risk insurance market will grow to $23 billion over the next five years and that interest in it will be ever increasing. One of the reasons for that is the fact that, once purchased, a cyber risk insurance policy will cover numerous costs.
The Covid-19 virus pandemic has brought us many changes, some of which concern your sector, the insurance sector. Can you tell us more about that?
Throughout the duration of the Covid-19 virus pandemic, many companies switched to working from home, which increased the risk of cybercriminals breaking into corporate systems and stealing business data. We were this time relying on our curiosity and interest in “miracle medicines” against viruses or deficient products, and this generally happens to a greater or lesser extent constantly, even without a pandemic. It is certain that opening infected links or attachments enables access to company data, or the theft, misuse or alteration of data, so the increase of such attacks has led to the start of the more significant development of insurance coverage for new forms of danger.
Intrusions into a corporate system can cause immeasurable damage. What does the insurance policy cover in the case of a cyber attack?
In these cases, a cyber risk insurance policy will provide coverage by reimbursing the costs of hiring the services of IT experts. These costs mainly relate to determining the extent of damage in terms of the type and number of endangered or lost data, its limitation and the recovery of data, the removal of malware, viruses and the like.
However, the most dangerous thing for a company is the endangering of the personal data of third parties in any way. Here the cyber insurance policy provides coverage for the costs of hiring legal advisors and crisis situation advisors, the costs of informing people whose data has been endangered, as well as other costs incurred with the aim of preserving a company’s reputation.
It is extremely important that a cyber risk insurance policy covers the direct financial consequences of a cyber incident
It is actually damage to reputation that costs many companies the most, especially when there is a loss of loss of third-party data including names, payment card numbers, health data etc. This leads to a loss of trust among their customers, and often raises the issue of managerial responsibility – from that of the CEO to the IT experts who run the company.
In which way can a company’s management protect itself from lawsuits? Is there a liability insurance policy?
It is often the case that so-called financial lines of insurance activate one another, and the cyber insurance and liability insurance of directors are precisely from these lines, while there are numerous examples of them being conditioned. However, the costs of defending against possible lawsuits launched by an owner of capital against management, as well as compensation for damages in the case that the responsibility of management is proven, are covered by the liability insurance policy of the director. A cyber risk insurance policy will cover the direct financial consequences of a cyber incident.
Apart form the costs of engaging IT experts, loss of third party data and mounting a defence in the case of lawsuits, a purchased cyber risk insurance policy includes coverage for so-called multimedia liability, with monetary fines imposed on the basis of misdemeanour orders issued by an authorised state body and managing crisis situations, as well as the costs of informing users and customer support costs.