Cybersecurity Insurance Doesn’t Have You Covered. Here’s Why.

A cybersecurity insurance plan sounds great in theory, but how much is it actually protecting you from potential threats? If you suffer a data breach, your business is going to have to suffer through downtime so it can address the problem, all the while you’re filing claims and hoping that your policy will cover the issue that occurred. What happens when you’re denied your claim, and you’re back to square one?

Unfortunately, cybersecurity insurance is little more than a scam. There are more exclusions than there are coverages, and today’s insurance providers have no clue how to best support businesses; not without costing them an arm and a leg in the process. Let’s go over how a cybersecurity insurance policy isn’t worth the investment and what you should consider instead.

Insurers Want to Say No More Often Than Yes

First, it’s important to acknowledge that cybersecurity insurance providers are businesses that thrive on the cybersecurity issues your business faces. They make their money from your misfortune, and that’s not okay.

These days, advanced threats to cybersecurity, like ransomware, are more commonplace than ever before. Insurers are losing money in spades, and they’ve had to change the way they approach their policies. Instead of writing checks, insurance providers are demanding compliance. This involves a technical audit, and the burden of proof is now in your hands as the policyholder. You’ll have to prove with logs and documentation that you were compliant with all security requirements before the attack occurred.

If you can’t, well, good luck getting a payout.

The Fine-Print Traps for Most Policies

Most businesses think they’re doing fine with their cybersecurity, but “fine” isn’t good enough for insurance companies. Here are three of the potential gaps they might find to deny your claims:

Issues with Multi-Factor Authentication (MFA)

MFA could be as simple as a code that gets sent to your phone after you type in your password, effectively locking your data behind two doors instead of one. You might already have MFA on your software solutions, but you also need it on your remote access points. This means you need MFA on any remote desktop software or virtual private networks used by your employees, and especially on admin accounts with more privileges. If the attacker finds a way into your business through an account that isn’t protected by MFA, your entire policy could be voided.

Backup Policies

Having a backup is not enough. Your insurance provider will want your backups segmented or offline (also called immutable) to keep them safe from ransomware attacks. You can also expect a provider to want logs of successful data backup test restores. To put this into perspective, imagine if you’re using a continuous cloud backup that syncs with your live files. Ransomware could encrypt your live data plus your cloud backup, rendering it useless…and if you’ve never tested your data backup in the first place, there’s no way to prove to insurance providers that your system works, voiding your entire policy.

Lack of Endpoint Detection and Response

EDR is basically an overpowered antivirus that not only looks for known threats, but it also detects suspicious behavior, which gives it a significant leg up compared to your typical antivirus. It can catch new attacks that haven’t even been documented yet, as it’s looking for the behavior caused by the threat, not just the threat itself. Insurers will see relying on your traditional antivirus system as negligence, and they will mandate a centrally managed EDR solution on all of your company devices (including servers, laptops, and remote workstations).

Modern Cybersecurity Insurance is a Liability Compared to Proactive IT

The problem with relying on something like cybersecurity insurance is that you’re waiting around for something to fail rather than taking action today to prevent it in the first place. If you’re not careful, the premium you pay for insurance could be for nothing as your claims are denied left and right, all because you don’t meet the stringent requirements of the provider.

If you don’t want to rely on insurance providers giving you the permission to recover from a potential cyberattack, or if you want reassurance that you’re meeting their requirements, consider working with BSGtech. We can audit your systems and make sure that you’re in compliance with whatever requirements they set. Learn more by calling us today at (866) 546-1004.