New-age enterprises are seen to establish the roots of their business online. With digitization catching up fast, it has become necessary for everyone to evaluate how safe their information is on the internet. While evaluation is the first step, a cyber insurance cover is the best backup that you can have against cyber threats.

What is cybersecurity insurance?

Cybersecurity insurance is a modern-day policy that helps safeguard policyholders from damages and financial losses due to systems and networks. These losses might not always be financial, for instance, data leaks, but the insurance companies compensate them. Since the internet has become a crucial part of our lives, from ordering your monthly groceries to honoring loan repayments, it is necessary to take adequate precautions to safeguard this information. Almost everyone has a virtual identity on the internet, and protecting the privacy of such related information is also necessary.

What are the broad categories of cybersecurity insurance?

The rising internet use makes users victims of cyber events like hacking, cyberstalking, and even digital fraud. This has made cybersecurity insurance a critical aspect of ensuring safety. There are two broad categories of cyber insurance –

• Individual cybersecurity insurance: As the name suggests, a separate policy is for regular and casual internet users. This policy protects individuals from security concerns like identity theft, malware attacks, cyberstalking, IT theft loss, and medical social liabilities. This policy is aimed at individual users, and in 2021, it will be a must-have for all.
• Cyber liability insurance: Not only individuals and organizations amounts of data about their users. The organization must safeguard the confidentiality of its user’s personal and financial information. This inorganization’sprotects the organization from data leaks and their consequent consequential

What are the types of losses that are covered under cyber insurance coverage?

It is necessary to understand cyber insurance coverage while buying a policy. Let’s look at the losses thatare covered –

For party first-parts of data or damage to programs that form part of the digital organization’s digital assets used due to downtime of networks result in financial impact.

• Security concerns about cyber extortion also form part of its coverage, where third parties seek ransom for releasing or damaging the organization’s data.
• It is an organization’s organizational requirement to notify customers if their data is compromised. A cyber insurance claim includes the costs of informing the customers during such a data breach.
• First-party coverage also includes the damages to the reputation of the policyholder (organizations in this case) due to such data leaks.

For third-party losses:

• A data breach that results in defense costs and civil damages is due to third parties forming part of third-party cyber insurance coverage.
• Liabilities in the form of publication of information, whether print or electronic, are covered under a third-party cyber insurance cover.
• System disruptions can result in the denial of athe access to customers. The third-party cyber insurance coverage covers the cost of such compensation that may be required to be paid to customers.

Take note of the above losses covered under a cyber insurance plan, and protect your computer network.