How is Cyber Insurance Helping Enterprises Mitigate Potential Cyber Risks?

Cybersecurity insurance is a product that enables several businesses to mitigate the risk of cybercrime activity such as cyberattacks and data breaches. It mainly helps organizations from the cost of internet-based threats affecting IT infrastructure, information governance, and information policy. This type of insurance is not covered by commercial liability policies, or traditional insurance products.  

What makes cyber insurance important for organizations? 

Nowadays, cyber insurance has increasingly become essential for most of the organizations as the risk of cyberattacks against applications, devices, networks, and users grows. As data is everything for all organizations, the loss, compromise or theft of data can significantly impact a business, from losing customers to the loss of reputation and revenue. Sometimes, organizations are also liable for the loss or theft of third-party data. A cyber insurance policy can protect the enterprise against cyber events, including acts of cyber terrorism, and help with the remediation of security incidents. 

What risks does cyber insurance cover? 

Most of the cybersecurity providers mostly offer first-party coverage of losses incurred through data destruction, hacking, data extortion, and data theft. Policies provided by cyber insurers may also provide coverage for legal expenses and related costs. Although policies may vary by provider and plan, the areas that cyber insurance covers include: 

• Providing notification to customers: Cyber insurers mostly help enterprises to notify their customers of a data breach, especially if it involves the loss or theft of personally identifiable information (PII). They help businesses cover the cost of this process.  
   

• Data recovery: A cyber liability insurance policy also enables businesses to pay for the recovery of any data compromised by any attack.  
   

• Providing coverage for ransomware attacks: Most of the ransomware attacks often demand attackers a fee from their victims to unlock and retrieve compromised data. Cyber insurance coverage can help organizations cover the costs of meeting such extortion demands. Although many governments agencies advise against paying ransoms as doing so only makes these attacks profitable for criminals.  
   

• Attack remediation: A cyber insurance policy helps an enterprise pay for legal fees incurred through violating various privacy policies or regulations. It helps them hire security or computer forensic experts who enable them to remediate the attack or recover compromised data.  

TCS’s new GenAI-Powered Cyber Insights Platform 

In November 2023, Tata Consultancy Services, an Indian multinational information technology services launched a new Cyber Insights Platform that extends AI and Amazon Security Lake to help customers enhance their cyber security and compliance. By launching this platform, TCS leveraged its expertise in managed detection and response to help customers unify diverse security datasets residing across public and private clouds. This platform is enhanced with machine learning models to help continuously monitor anomalies, predict potential issues in advance, and help clients proactively address these potential threats.  

TCS used its deep domain knowledge across different industry verticals to tailor the Cyber Insights Platform addressing industry-specific security needs. Financial Crime Fusion Center is one such offering of this platform that uses AI to equip financial services clients with insights such as account takeovers, unauthorized fund transfers, and identify theft, by fusing data from their fraud detection and cybersecurity systems.  

Alliances made by top players that have reshaped the industry landscape 

The global cyber insurance market has experienced significant growth due to the increase in the development of new variety cybersecurity products and services. Moreover, the increase in the adoption of IoT, AI, and cloud services by cyber insurers to create customized plans for certain industries in order to address evolving cyber threats is expected to augment the growth of the domain in the forthcoming years. For instance, in January 2024, The Travelers Companies, Inc., an American insurance company announced its acquisition of Corvus Insurance, a leading risk mitigation solution provider, offering real-time threat intelligence, security recommendations, and access to cyber experts to help manage and reduce cyber risks. With this acquisition, Travelers aimed to bolster its cyber insurance capabilities by incorporating Corvus’ industry-leading suite of integrated cyber sales, underwriting, service and support capabilities.  

Similarly, in August 2023, Thoma Bravo, an American private equity and growth capital firm signed an agreement to acquire ForgeRock, an identity and access management software company. Under this acquisition, the companies envisioned to better serve customers across the dynamic and fast-growing Identity and Access Management market by providing enhanced product and services, increased innovation, and broader geographic support. 

To conclude, cyber threats have major implications on public safety, economic prosperity, and government security due to which governments of various nations have formed respective cybersecurity commissions and task forces which is expected to foster the growth of the market in the coming years. Furthermore, many companies are extending cyber liability to their supply chains which is expected to create wide growth opportunities for the cyber insurance providers to innovate their insurance products in the future.  

Short Description: Cyber insurance is a contract that an organization or entrepreneur can purchase to reduce the risk associated with conducting online business. It notifies organizations of a data breach, helps them with data recovery, protects them from ransomware attacks, and helps them pay legal fees for violating any regulation.  

✍ **𝑨𝒓𝒕𝒊𝒄𝒍𝒆 𝒘𝒓𝒊𝒕𝒆𝒓: Rosy Behera 

Author’s Bio- Rosy Behera holds a bachelor’s degree in Electrical and Electronics Engineering and now she has been working as a content writer for the last 5 years. Grabbing readers’ attention with a nice command of words and offering creative write-ups consistently are her biggest assets so far.