At Raffles Provident, we strongly believe that data protection plays a crucial role in every business. Therefore, we aim to educate and assist businesses in their selection of the “right” cyber insurance for their business. In addition, we hope that our client can be better protected against cyber threats with the support from cyber security experts, allowing our clients to build a stronger and safer cyber work-space.
What is Cyber Insurance?
A cyber insurance policy, also referred to as cyber risk insurance or cyber liability insurance coverage (CLIC), is designed to help an organization mitigate risk exposure by offsetting costs involved with recovery after a cyber-related security breach or similar event. Many insurers in the market are currently offering a wide variety of cyber insurance policies that are able to cater to different needs of their clients. With the increasing threat of cyber-attacks on businesses in the recent years, some businesses made it a point to purchase cyber insurance to help them respond to possible data breach.
History of Cyber Insurance
As technology evolved in the late 1990s, technology-related risks evolved with it. The first cyber insurance policies were written to address these exposures and focused on online content or software. Over time, the technology and accompanying policies have evolved extensively into a vibrant and volatile cyber insurance market.
The history of cyber security insurance policies in the United States begins in the late 1990s. Some were policies that covered online media, while others were errors in data processing (EDM) policies. Early cyber insurance coverage generally evolved from professional liability policies for software and media risks. In addition, most traditional policies did not include first-party coverage.
Tips on Choosing Your Cyber Insurance
Over the years, cyber insurance are getting more and more popular among businesses. With the increase use of technology in the workplace, cyber insurance is starting to play a crucial role in the business world. Many insurance industry watchers also believes that clients will soon expect cyber insurance to part of every business insurer’s product line. However, like any business insurance, cyber insurance coverage varies by insurer and policy. Therefore we believe that businesses should be educated on their selection of the “right” cyber insurance which consist of the coverage that the business would need in their protection of data. When comparing policies among insurers, businesses should identify key features that are important in covering the business in the even of a cyber-attack. This could include:
- Coverage of the policy
- Legal Protection
- Cyber Solution
Businesses may also inquire on the following special circumstances and limits to better identify policies that meet your business needs. Some factors to consider are:
- Does the insurer offer one or more types of cyber insurance policies or is the coverage simply an extension to an existing policy?
- Does the insurer offer customization in the policy?
- What are the deductibles? Be sure to compare deductibles closely among insurers..
- How does coverage and limits apply to both first and third parties?
- Does the policy cover any attack to which an organization falls victim or only targeted attacks against that organization in particular?
- Does the policy cover non-malicious actions taken by an employee?
- Does the policy cover social engineering as well as network attacks?
Tip: Many insurers offer a checklist of coverage items which allows potential clients to compare against their competitors. Use those checklists to add to your list before starting your research in earnest.
Why do you need it?
Any organization that stores and maintains customer information or collects online payment information, or uses the cloud, should consider purchasing cyber insurance to protect themselves. Many businesses, especially SMEs, tend to think that they are safe and that cyber attacks only happens in large corporation. However, in the recent years, small businesses are also suffering from cyber attacks. In 2018, Cyber Security Agency of Singapore reported that phishing attacks on businesses have increased by almost 10 times since last year. In addition, the Singapore Cyber Landscape have notice that there is a shift in the cyber attack trend with an increase phishing attacks targeted at technology companies instead of companies in the banking and finance sector. On top of that, during the Trump-Kim Summit in June 2018, Singapore was mentioned as the top cyber attack target around the world.
With all these statistics, it is extremely important for businesses in Singapore to take action to protect themselves from such cyber attacks. Therefore, we strongly advise businesses that have yet to purchase a cyber insurance policy to seriously consider getting one to protect themselves from possible cyber attacks.
© 2019 Raffles Provident LLP
Biz registration number: T13LL0595E GIAS number: C004125
+65 31451768 • Andrew@rafflesprovident.com.sg