Cyber Secuirty Insurance

First, let’s establish what constitutes a ‘cybercrime’. The Australian Federal Police (AFP) states that the term is used to describe crimes that are directed either at computers or a range of other information communication technologies (ICTs). 

This predominantly entails computer intrusions and denial of service attacks. It is also used to describe any crime where computers or ICTs play a crucial role within the felony, for instance, online fraud. 

Now cyber criminal groups can target hundreds and thousands of Australian individuals and businesses all at once, from a single source and from just about anywhere in the world. Through dark web forums and illegal marketplaces, integral business information is increasingly being compromised. 

Therefore, cyber insurance is a product that enables businesses to mitigate the risks associated with cyber attack, especially from threats impacting IT infrastructure, information policy and governance. 

Essentially, it works in the same way businesses would purchase insurance coverage against other risks such as public liability and workers compensation insurance policies. It helps organisations pay for any financial losses incurred in the event of a cyber attack. Likewise, most insurance policies also cover any costs involved in the remediation process, including investigation costs, legal services, and refunds to affected customers. 

The type of inclusions for cyber insurance differs between different providers and policies. However, cover is generally provided for: 

• Pre-incident support 
• Security and privacy breach costs 
• Cyber extortion
• Damage to digital assets  
• Business interruption
• Liability costs
• Crisis management costs 
• Forensic investigation costs 
• Loss and legal costs 
• Data and personal identities recovery 
• Post-incident support

Just like most insurance policies, even cyber insurance comes with a set of exclusions of its own. It typically excludes issues that were seemingly preventable or caused by human error such as:

• Inadequate and/or poor security processes 
• Breaches prior to the policy 
• Insider attacks 
• Property damage
• Existing vulnerabilities

While cyber insurance is currently not mandatory by law in Australia, it is strongly recommended by regulatory bodies especially if you’re operating within an industry that handles large amounts of personal data. This is to ensure that your business complies with privacy laws and regulations. 

In the event of a cyber attack, your cyber insurance policy provider is entitled to provide you with immediate, 24/7 support. Most insurance providers have a dedicated emergency response hotline that specifically addresses unexpected cyber attack incidents. 

When dealing with a potential cyber security attack, your first course of action is to immediately contact your insurer to receive the necessary support needed.