Why It's Harder to Get Cyber Insurance This Year

Have you noticed it is harder to get cyber insurance coverage for your business this year? It's not just you. Many Treasure Valley businesses are facing this problem. Why is that?

As the cyber threat landscape evolves, insurance companies are tightening their requirements and increasing scrutiny on the cybersecurity measures of their policyholders. This means that if your company doesn't already have advanced cybersecurity controls in place, you will either be denied coverage, or given a time limit to get the proper security in place before coverage can resume.

Here’s how cyber insurance carriers are contributing to the push for advanced IT security:

1. Stringent Underwriting Requirements

• Pre-policy Assessments: Insurance carriers are conducting more thorough assessments before issuing policies. They require businesses to demonstrate robust and comprehensive cybersecurity measures.
• Baseline Security Standards: To qualify for coverage, businesses must meet specific security standards, such as having up-to-date antivirus software, firewalls, encryption, and intrusion detection systems. Consolidated IT security solutions help meet these requirements more efficiently.

2. Regular Audits and Compliance Checks

• Ongoing Evaluations: Carriers often conduct regular audits to ensure that policyholders maintain their security posture. Businesses with consolidated IT security can provide clear, comprehensive reports and demonstrate continuous compliance more easily.
• Penalty for Non-compliance: Failure to adhere to the required security practices can result in higher premiums, reduced coverage, or even policy cancellation. Consolidated security solutions help maintain compliance and avoid these penalties.

3. Risk-based Premiums

• Lower Premiums for Strong Security: Businesses with strong, integrated security measures may qualify for lower premiums. Consolidated IT security demonstrates a proactive approach to risk management, making businesses more attractive to insurers.
• Higher Costs for Fragmented Security: Conversely, businesses with fragmented, less cohesive security strategies may face higher premiums due to perceived higher risks. Consolidation can mitigate these costs by presenting a unified, strong defense.

4. Incident Response and Recovery Support

• Efficient Incident Management: In the event of a cyber incident, having a consolidated security platform can streamline the response and recovery processes. This is crucial for meeting the requirements of cyber insurance policies, which often mandate timely and effective incident management.
• Claims Processing: Comprehensive security documentation and a clear incident response plan can facilitate smoother and faster claims processing, ensuring businesses receive the support they need without unnecessary delays.

5. Coverage Scope and Limits

• Enhanced Coverage Options: Businesses with consolidated and advanced cybersecurity measures may qualify for broader coverage options and higher policy limits. Insurers are more willing to offer enhanced coverage to those who demonstrate a lower risk profile.
• Exclusions for Poor Security Practices: Policies may have exclusions or limitations for incidents resulting from inadequate security practices. Consolidating IT security helps ensure that businesses do not fall into these exclusion categories.

Conclusion

The influence of cyber insurance carriers adds another layer of pressure for Boise businesses to consolidate their IT security. By meeting the stringent requirements of insurers, businesses can benefit from lower premiums, enhanced coverage, and better support in the event of a cyber incident. Consolidated IT security solutions offer a comprehensive and cohesive approach, making it easier for businesses to comply with insurance requirements, manage risks effectively, and ensure continued protection in an increasingly complex cyber threat landscape.

Investing in consolidated IT security through TotalCare IT not only strengthens your defenses but also positions your business favorably with cyber insurance carriers, ensuring financial protection and peace of mind.