Why Are More and More Companies Getting Cyber Security Insurance?
Any CEO of a small and medium size company who keeps up with the news knows about the dangers of the cyber world. Business networks are under constant attack from hackers, criminals, foreign intelligence organizations and, often most dangerously angry or greedy insiders.
There dangers are only part of the threat. More and more lawyers are now suing companies for lapses in cyber security, helped by a growing number of laws that increase cyber liability risks.
· At least 46 states and the SEC now require disclosure of hacks in many circumstances, opening companies to major lawsuits
· Federal contractors and government agencies are now demanding Interconnection Security Agreements (ISAs) with vendors – potentially making the vendor responsible for losses suffered by the client
· Prime contracts are increasingly expected to require cyber insurance for vendors and subcontractors
· Adding to the challenge: Many if not most traditional insurance policies do NOT cover losses from cyber attacks, leaving companies holding the bag