Cyber Insurance or Protection – why you need both

Sharon Holland

With the prevalence of massive cyber-attacks in recent years, it is no wonder that cyber insurance is a growing industry.  See our blog on the types of cyber insurance available.

Some companies are weighing the pros and cons of cyber insurance versus DDoS protection.  However perhaps it is not the answer that we should look at, but the question.

We all already know that, for many things, insurance is no substitute for adequate security.  Certainly my house insurance would not pay out on a claim for burglary if it is discovered that the doors were unlocked.  So why do some companies consider substituting cyber insurance for DDoS protection?

They think it is cheaper. It costs less to just buy the insurance and don’t worry about the protection.  But even if your cyber insurance is prepared to pay out when you do not have DDoS protection it may not cover all the costs of a DDoS attack.  And the intangible losses such as damage to reputation and business trust, as well as being hard to measure, are unlikely to be compensated.  And these intangible losses will have ongoing effects on the business long after the attack.

Even if you are covered for replacement/repair of physical items/services, how much of your staff time will be diverted to dealing with an attack. So is it really cheaper?

They think they won’t get attacked. You will. It is pretty much a case of when not if.

It is just about the DDoS attack.  DDoS attacks can hide even worse crimes.  DDoS attacks are being used more and more to divert/cover for another attack that could result in a data breach. So protection against DDoS attacks also reduces your risks of cyber criminals using this as a way to perpetrate other crimes.

It only affects big businesses.  In 2017 one in four small businesses in the UK suffered a cyber-attack, according to Hiscox Cyber Readiness Report 2018.  This is something that can, and does, affect everyone.

They forget prevention is better than cure. Even if you are fully compensated for an attack it is still better to prevent it in the first place. If a policy covers all items, you still don’t get compensated for the hassle in sorting the claim.  We all have car insurance, but most people will do their best not to claim to avoid the inconvenience.

Cyber insurance is a great way to make sure you are not too much out of pocket after an attack, but it is even better not to suffer an attack in the first place!

To find out how activereach can help you protect yourself against a DDoS attack contact us or call us on 0845 625 9025