6 Steps to Secure Cyber Insurance Coverage for Your Business

Cybersecurity insurance policy

The art and science of cryptography have been around for thousands of years.

From the use of complex codes to conceal messages in ancient wars all the way up to today's ongoing arms race between white and black hat hackers, information security has always been a matter of time and persistence, with the black hats always holding the edge.

In other words, any code can be cracked with enough intelligence or time. 

What this inevitably means for anyone with sensitive data to protect is that no cyber security toolset can always thwart all attacks.

In other words, it is only a matter of time before a successful cyber attack comes your way.

The results of such an attack could be minor, but it could also be catastrophic, and because a successful attack is inevitable, there is only one way to be certain your business won't be destroyed when a data disaster strikes: cyber insurance coverage. 

With quality cyber insurance coverage, you can expect your investment in data security to pay off after digital bad actors have had their way with your data.

The alternative is to hope your malware tools are strong enough to repel the next unknown zero-day attack. 

You have money to steal and so do your customers.

The digital space where you and your customers exchange payment data is always going to be the focus of a cyber thief's efforts to steal that money or data.

You may not be able to stop them, but you can become impervious to their criminal acts with cyber insurance coverage.

Now, let's learn how to use this one unbreakable cybersecurity tool. 

1. Assess Cyber Risks 

The key to obtaining cyber insurance cybersecurity that you can afford and that works for your business is to know and understand the data-related risks your business faces.

The cyber risk profiles of many businesses are similar, but no two risk profiles are the same. 


Steps To Identify And Assess Unique Cyber Risks And Vulnerabilities 

  • Step one is to identify your assets. How do you earn money? What is it that you do that makes your business valuable to your customers? This, at the digital space where legal tender is exchanged, is the point where attacks are most likely to come. 
  • Step two is to identify your threats. What types of attackers and what types of attacks are most likely to come your way? 
  • Step three is to have a reasonable understanding of the consequences of a successful attack. 
  • Step four is to develop an accurate assessment of the extent of the damage a likely attack can do and to prioritize those risks in terms of likelihood/damage. 
  • Step five is to develop clear and complete documentation of all of this information. 

Your cyber insurance coverage provider will want to see that you understand the risks you face and that you have reasonable protections in place.

To obtain the best premiums, your insurer will want to see that you are taking all reasonable measures to defend against attack.

Just as an auto insurance provider wants you to drive safely and a home insurance provider wants you to have smoke detectors, a cyber insurance provider wants you to use due caution as well. 


Cyber Risk Audit 

What we have just described is known as a cyber risk audit, and it probably sounds like a big project.

The good news is that you don't have to go it alone.

A good cyber insurance coverage provider wants to see that you have the ability to assess yourself, but they will also want to provide you with expert consultancy to the same effect.

After all, they don't want you to have to file a claim and have a vested interest in helping you avoid attacks. 


2. Identify Cyber Insurance Coverage Needs 

Once you've done your homework, you should have a good idea of how badly your business, reputation, and bottom line could be harmed by a successful attack.

That being the case, you should be able to estimate how much coverage you may need if your data is badly compromised. 

Your insurance provider will help you choose a policy that provides adequate coverage for your unique cyber risks, but it's still best to come to the negotiating table with actionable intelligence. 

Factors to consider when evaluating cyber insurance coverage needs

  • Identify goals and expected benefits of cyber insurance
  • Understand the conditions of coverage
  • Ensure key coverage areas are considered
  • Ensure coverage areas and amounts are proportional
  • Have an understanding of the losses to be covered 


3. Research Cyber Insurance Companies (Agencies / Carriers) 

Getting the most out of cyber insurance coverage, as stated, requires some self-directed research.

A good carrier will do their level best to provide the best value because they understand that they have an interest in your data security.

But how do you know you're signing on with a qualified, reputable, and trustworthy carrier? 

It might help to recognize the state of the cyber security insurance market as a whole.

At present, it is in what might be called an inflection point.

This means that the carriers who make up the market are self-reflecting, looking to see how best to present themselves.

Therefore it makes sense to say that a good cyber insurance coverage carrier presents itself honestly and a poor one might not. 


How To Research And Compare Different Cyber Insurance Carriers 

This realization about the market leads us to the one perennial point of advice when it comes to vetting any merchant; check their reviews.

Indeed, a thorough search of customer reviews is a great way to start vetting any insurance carrier.

Of course, this is not enough. 

You also want to look at the age of the lender and the number of years of experience they have in cyber insurance. 

You might be surprised at how long some companies have been offering cyber insurance coverage.

After considering those two things, the best cyber insurance provider for you will be the one whose products and policies are the best match for your unique data risk profile. 

Here are the top 10 cyber insurance carriers, according to Insurance Journal.

Take a look through these organizations and compare them according to the metrics mentioned above.

  1. Chubb LTD
  2. AXA Insurance
  3. American International
  4. St. Paul Travelers
  5. Beazley Group
  6. CNA Insurance
  7. Axis Capital
  8. BCS Insurance
  9. Fairfax Financial
  10. The Hartford 


4. Obtain and Review Cyber Insurance Quotes 

To get a quote, you'll need to speak to a representative of an insurance provider you are considering.

The quality of the quote will depend on the reputation of the company and on the amount of information with which they have been provided. 

The way to get the best quote is to provide them with a complete cyber risk assessment.

Better still, is for the insurer to perform a cyber risk assessment on your company. 

To fully vet a cyber insurance quote you must have a high-quality cyber risk assessment done before they provide you with theirs.

If you know your assessment is accurate and thorough, then you can compare it to theirs.

From that point, you can vet carriers by how well their quotes match up to yours. 


5. Complete Cyber Insurance Application 

When you finally select a carrier, the application process can begin.

Applying for cyber insurance begins with the information-gathering process, which we have discussed.

In the best-case scenario, this is a very in-depth process, involving a full appraisal of your risk and response profile.

You may need to make heavy revisions to your data security capabilities before moving forward. 

Be sure to pay attention to: 

  • Extra coverage grants
  • Sub-limits
  • Deductibles
  • Vendor selection
  • Exclusions
  • Prior acts 

Finally, your policy will be in place when your provider accepts your risk profile and chooses to insure your organization.

It can be a long and arduous process.

But when you work with a quality insurance provider, it will be worth every ounce of effort you put into it. 


6. Bind Cyber Insurance Policy 

Setting a cyber insurance cybersecurity policy in stone is like binding any kind of insurance policy.

You will:

  1. Select options and review coverage.
  2. Select dates of coverage.
  3. Review the contingencies.
  4. Upload your signed application.
  5. Request an e-signature.
  6. Satisfy the contingencies.
  7. Get the policy or choose conditional binder/s 

Carefully review policy details, ensuring that you understand them.

If necessary, you should consult an attorney and/or cyber security experts to make sure you understand the terms, conditions, and potential outcomes.


Ongoing Cyber Risk Management 

Finally, you will need to stay abreast of best practices for managing cyber risk, because they do change.

Of course, the basics of cyber risk management are always the same, but the technical details are always in flux.

For this reason, many cybersecurity experts and cyber insurance consultants work closely with IT professionals.

It is probably a good idea that you do the same. 


Safeguarding Continued Coverage 

As you go through the consultation and application process, and especially before your policy is complete and effective, your provider will lay out concrete terms of your continuing coverage.

These will be made up of regulatory compliance and cybersecurity best practices. 

To fail to remain in alignment with their recommendations is to risk losing your coverage.

As mentioned above, any good cybersecurity insurance carrier understands that they have an interest in helping you protect your data and avoid your having to file a claim. 

This means that their recommendations are almost certainly in your best interest.

So you want to comply not only to keep your coverage but to establish a quality data security practice as well. 



In review, you want to have produced a thorough and high-quality in-house cyber risk assessment.

This can be done with the help of your IT consultant.

Second, you want to compare the reputation and experience of the carriers you are considering.

Compare your self-assessment with theirs, and those of their competitors and consider the cost of each. 

Finally, take the guidance your cybersecurity insurance provider provides seriously since their interests and yours are aligned.

The best cyber security carriers out there will not steer you wrong.

But quality guidance may be necessary to choose the best one for your unique needs. 

Get in touch today to learn more.






Read On