In the past few years, ransomware attacks have become a pressing cybersecurity concern across industries, and even the most well-known companies have fallen victim. These high-profile cases have revealed that every business, from a small company to a Fortune 500 enterprise, needs more than a few cybersecurity measures to protect itself.
If you’re looking for an added layer of security, you need ransomware insurance. Learn what it covers and why it should play an essential role in your company’s security strategy.
To understand how ransomware coverage works, you first need to know what ransomware is. During a ransomware attack, cybercriminals gain access to your data and make it inaccessible. Then, they request a ransom payment in exchange for a key. If companies don’t pay the ransom, they risk losing their files forever or suffering serious damage to their network.
Cybercriminals often use malicious emails to infect a company’s network with ransomware. One unsuspecting employee could click a link that seems legitimate and trigger an attack that shuts your business down for days.
Ransomware has existed for years, but it has become increasingly common. These attacks are easy to execute, and many companies agree to pay the ransom, making them highly lucrative for cybercriminals.
How can you protect your company from ransomware? In addition to adopting cybersecurity measures, you need ransomware insurance.
Ransomware insurance coverage is a type of cyber insurance that covers financial losses following an attack. Depending on the insurance company and policy you choose, ransomware insurance might pay for:
- Ransom payments
- Data restoration and hardware repairs
- Crisis management
- Third-party negotiators
- Cybersecurity consultations
- Lost profits following an attack
Essentially, ransomware insurance coverage provides a financial safety net after an attack. Like other business insurance coverage, it ensures that an unexpected loss event doesn’t drain your bank account.
If you already have a cyber liability policy, you’re probably wondering if it includes ransomware coverage. There’s a good chance it does—many cyber policies include cyber extortion coverage, which covers ransomware attacks. However, you may need to modify your policy or purchase separate ransomware insurance to protect your risks adequately.
Many companies realize too late that their policy doesn’t cover ransomware. To ensure you don’t have to drain your bank account after an attack, you should consult an experienced insurance agent.
If the past few years have shown us anything, it’s that no one is immune to a cyberattack, including large companies like Microsoft, Acer, and Kronos. No matter how well you train your employees or protect your sensitive data, there’s no fail-safe way to ward off cyber threats.
Here are a few stats that put your cyber risks into perspective:
- Ransomware attacks increased by 105% in 2021.
- In 2021, businesses suffered over three weeks of downtime on average following a ransomware attack.
- The average total cost of recovery after a ransomware attack climbed to $1.85 million in 2021.
Without ransomware insurance, you could lose hundreds of thousands of dollars after an attack—enough to put your future in jeopardy. That’s why cyber coverage is a critical risk management tool for any business.
Even if you use the most advanced security measures to protect sensitive data, you can’t prevent every cyberattack. Savvy cybercriminals continue to find ways to bypass security systems and trick employees. If you want to protect your company, you need a two-pronged approach that prevents attacks and protects your business if one does happen.
Whether you need a new cybersecurity policy or an expert to reevaluate your current ransomware insurance, Southpoint Insurance can help. Our experienced risk management team stays one step ahead of cybersecurity trends and passes that knowledge along to our clients. If you’re concerned about a data breach, social engineering attack, or ransomware, we’ll make sure your insurance policy has you covered.
Get in touch today to learn more about our ransomware insurance options or request a quote.