Can Businesses be denied Cyber Insurance?
In our world of constantly evolving and varied cyber threats, many organizations consider cyber insurance to help them get back on their feet should they fall victim to a cyber event. Data breaches and ransomware attacks can also require specialized expertise and funds to deal with. For these reasons, many business owners choose to purchase cyber insurance for financial protection should an incident occur. Here are some reasons why you get denied cyber insurance
Cyber security insurance used to be either very expensive or a cheap add-on to an existing policy. These days, it has its niche market and has become a critical need for many businesses.
It’s worth noting, however, that cyber insurance does not solve all cyber-related problems, and it won’t ever prevent a cyberattack or data breach. Just like businesses with physical property need to put appropriate measures in place for security, so do companies with intellectual property.
Unique cyber insurance for a unique business
Generic business insurance doesn’t cut the mustard. It rarely even mentions data loss. Of course, there are overlaps in many cyber insurance policies, but businesses should have coverage that is as unique as their business.
Beyond the basics, there are various additions and enhancements that policies can offer. As a result, you won’t know what to watch out for unless you’re aware of them. There are enhancements such as social engineering coverage (for employees who get duped into doing things), reputational harm coverage (often related to a security breach), and technology bricking (replacing technology equipment that is no longer usable after malware infection). Make sure you cover everything important to you.
Cyber insurance prequalification
Even if businesses prequalify for cyber insurance, it is still possible to get denied. Even if you have had cyber insurance in the past, it can still happen to you. There are many reasons for this.
Poor plans for business continuity and disaster recovery
Cyber insurance providers want a return on investment. If a provider believes your business cannot recover from a disaster, they may deny your application. Disaster recovery doesn’t just mean having backups. Businesses need adequate disaster recovery plans to make sure they’re able to survive after a cyber event.
Poor account security – multi-factor authentication
Businesses are often denied cyber insurance coverage due to the lack of multi-factor authentication. Many providers focus on account security before they offer a policy.
Poor cybersecurity awareness
Training employees is essential for maintaining appropriate cyber security. It’s no secret that employee involvement is one of the weaker aspects of business security. Training for employees is vital – and it needs to be updated as cyberattacks evolve.
Inadequate endpoint security
Many policies require more than antivirus software. Businesses often need endpoint detection and response tools that combine several security measures covering a range of detection and prevention techniques.
Using an MSP to assist even if you have cyber insurance prequalification
Being denied cyber insurance is a daunting prospect, and when a business gets rejected once, it’s even harder to get a policy. This roadblock is where your Managed Service Provider comes in.
By using an MSP to help with cyber insurance prequalification, you’re making sure you have experts looking into everything with an experienced eye. Your MSP can help rectify the areas that need improving if you do not qualify for a cyber insurance policy.
Final thoughts
Even if you have a prequalification for cyber insurance, you can still get denied coverage. MSPs can help you secure cyber insurance and cyber insurance prequalification by assisting businesses to meet the necessary criteria. For more information, get in touch with us to schedule your free cyber security business review.