A cyber insurance policy, also referred to as “cyber risk insurance” or “cyber liability insurance” coverage, is a financial product that enables businesses to transfer the costs involved with recovery from a cyber-related security breach or similar events. If your business stores a customer's data (names, addresses, credit card information, Social Security numbers, etc.) on any type of computer system (online or offline), then there is a regulatory obligation to keep that data secure. This means there will be a higher price tag in the event of a breach.
Cyber insurance helps with notifying customers about a data breach, restoring personal identities of affected customers, recovering compromised data, and repairing damaged computer systems, in case your personal information (Social Security number, driver's license number address, and bank account information) is stolen. Cyber insurance providers also have a duty to defend policyholders from related administrative actions or liability lawsuits. Most insurance also provides resources that help policyholders design cost-effective, robust security and data encryption protocol.
The company's ability to avoid an incident and the coverage's limit are the two biggest factors in determining premium costs, revenue, and the number of unique personal information and medical records stored on the insured's computer.