What You Need to Look for in a Cyber Insurance Policy

Perhaps predictably, the word “insure” has roots that tie it closely to “ensure,” as it is meant to ensure a level of security after some form of loss. Nowadays, that loss often pertains to data, making cyber insurance an extremely valuable investment for the modern business to make.

However, in order to obtain this kind of insurance, businesses commonly need to meet some basic requirements. Let’s go over some of these requirements now.

What Are Insurance Providers Looking for to Approve Cyber Insurance?

It’s important that your business is not only meeting the requirements that an insurance provider expects from you, but that you also have it fully documented. This helps make it easier for everyone to stay on the same page, as well as to evaluate how prepared the business is to protect its data. What follows are some of the preparations that many insurance providers expect to see from businesses seeking coverage.

Multi-Factor Authentication Protecting Email (at a Minimum)

It should come as no surprise that email is a major target for cybercriminal activity. It’s popular, it’s convenient, and—as countless attacks have proven—it works. If a cybercriminal manages to gain access to a target’s email account, they effectively have the keys to the castle, as any accounts tied to that email can then be altered and adjusted.

This is what makes it so important that if you have multi-factor authentication protecting anything, your email is a good candidate… although, we recommend that it’s implemented wherever it is available. Multi-factor authentication reinforces your security by adding additional requirements to a login process before access will be granted, ideally by also requiring a user to confirm their identity, often through a secondary key or by providing a generated code or biometric proof.

The long and the short of it is that MFA is a very effective means of eliminating unauthorized access, which is something that insurance providers want to see before they offer coverage.

Testing and Training for Cybersecurity Awareness

On a related note, insurance providers want to see staff engagement where a business’ cybersecurity is involved. After all, all the protection in the world won’t matter if one of your team members leaves the door open or allows an attacker in. This makes it critical that your team knows about the threats they face and—crucially—how to appropriately identify and react to these threats as they encounter them.

Due to the evolving nature of cybercrime, this needs to be an ongoing process. You should be regularly evaluating your employees with and without warning, providing immediate education to anyone who misses one of your simulated threats. Your potential insurance provider will likely want to see documented proof that these steps exist and are enforced as they consider your application.

Incident Response, Backup and Disaster Recovery, and Similar Defenses

In order for these policies to stay profitable, insurance companies will want to see that every precaution has been put in place. After all, the less likely a policyholder is to suffer the damages that their policy covers, the less likely it is that the insurer will have to issue a reimbursement payment. As a result, insurance providers like to see that businesses are as prepared as possible, so they don’t just want to see preventative measures, but mitigations as well.

Therefore, your insurance provider is going to want to see everything you have in place as a part of your incident response plan. They’ll want to see that your backups are situated and updated appropriately, they’ll want to see established processes and systems, and they’ll want to see that you have different people assigned to carry these processes and systems out.

Applicable Compliance Gap Assessments

Chances are pretty good that you process credit card information as part of your business operations in some shape or form. This means that you presumably need to align to the Payment Card Industry Data Security Standard (PCI DSS), which dictates what businesses need to do to protect the information of their cardholding customers. A gap assessment is a process that helps you identify anywhere that you fall short of true compliance, allowing you to more effectively resolve these issues to reach the standards expected. Because of this, insurance providers will want to see the results of your gap assessments and documentation of any steps that you’ve taken to fix the issues present regarding any applicable compliance requirements.

We can help you maintain the standards that an insurance company will be looking for to approve your business for cyber insurance coverage. Learn more about our managed IT services by giving us a call at (205) 208-0340.