Data breaches are like lightning: one never knows when or where they’ll strike—or how much damage they will cause. Given their unpredictable nature, data breaches are difficult to budget for. Cyber insurance can help offset these unexpected costs, but keep in mind that it is not a substitute for implementing good data privacy and security practices. In addition, cyber insurance does not cover all expenses, such as diminished reputation or customer churn.
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6. Find a knowledgeable broker. A broker who understands cyber insurance can break down and compare the offerings from different insurance providers. They often offer value-added services that can help identify and mitigate breach risks, as well as validate the need for a policy.
7. Take advantage of value-added services offered. Some insurance brokers and carriers offer complimentary value-added services to help reduce breach-related risks: free consulting or legal advice from industry experts, access to a proprietary portal with privacy and security resources, educational webinars, and policy templates. When weighing policy choices, organizations should evaluate these services as part of the overall offering. As a plus, these offerings may help improve a company’s risk profile and and lower its insurance premium.