As we head into the busy fall season, cyber threats are on the rise with heightened online activity and end-of-year preparations. For Managed Service Providers, now is the time to ensure your clients are shielded from these risks. Here are eight crucial myths about cyber insurance that could leave your clients vulnerable:
- Cyber Insurance Only Covers Data Breaches
Fact: Comprehensive cyber insurance covers more than just data breaches. It includes ransomware attacks, business interruption, legal costs, and regulatory fines. In 2023, 66% of organizations faced a ransomware attack. (Sophos, 2023)
- Cyber Insurance Replaces Cybersecurity Programs
Fact: Insurance is not a substitute for robust cybersecurity. It complements your security measures by providing financial protection. For instance, T-Mobile faced two major breaches in 2023 despite having cybersecurity protocols. (Packetlabs, Cybercrime Magazine) That’s why we work with you to ensure your clients have baseline security controls in place, and are eligible to save 30 – 40% on their cyber insurance because of it!
- Compliance Means No Need for Cyber Insurance
Fact: Compliance sets minimum requirements but doesn’t protect against sophisticated cyber threats. Insurance adds a vital layer of protection beyond compliance.
- Only Tech Companies Need Cyber Insurance
Fact: Any business that uses computers is at risk. In 2023, 43% of cyberattacks targeted small to mid-sized businesses outside the tech sector.
- Small Businesses Aren’t Targeted
Fact: Small businesses are prime targets for cybercriminals due to potentially weaker security. Nearly 50% of cyberattacks in 2023 were aimed at small businesses, with an average data breach cost of $2.75 million.
- Cyber Insurance Covers All Incident Costs
Fact: Policies have limits and exclusions. In 2023, 35% of businesses found coverage gaps after incidents. Although cyber insurance has notoriously been ambiguous and confusing, understanding policy details to ensure adequate coverage is crucial, and something our team at SeedPod Cyber are experts in communicating.
- Cyber Insurance is Just Financial Recovery
Fact: Although Cyber Insurance does cover direct financial losses that result from a loss, like loss of business income, and ransomware, it also provides access to incident response teams, forensic experts, and legal counsel, crucial for managing cyber events efficiently and minimizing the effects.
- Cyber Insurance Means No More Worries About Cyber Threats
Fact: Insurance supports recovery but does not replace the need for strong cybersecurity practices. Businesses with both robust cybersecurity and insurance were 50% less likely to experience severe breaches in 2023.
Minimize Your Risk from Uninsured Clients
Review your clients’ cyber insurance needs as we enter this high-risk season.
Take advantage of our Cyber Check Up Tool for a quick review of your clients’ coverage, alternative quotes, and optimal risk management strategies to better protect yourself and your clients today!
