Way back in the cyber dark ages of the early 1990s as many households were buying their first candy-colored Macintoshes and using them to play Oregon Trail and visit AOL chat rooms, many businesses started venturing into the digital realm as well by giving employees access to the new digital tools like email, ftp file sharing, and early SaaS products.
Early cyber threat techniques such as phishing, social engineering, viral worms and unauthorized network access could put confidential corporation information at serious risk and lead to loss of productivity and revenue.
The late 1990s witnessed the emergence of cyber security as a distinct insurance category.
Starting in approximately 1997, insurers including Lloyds of London, began constructing new policies to cover business losses resulting from unauthorized access, data theft, productivity losses and other fallout from cyber events.
2018 however marked a global turning point in demand and a sharp rise in the cost of cyber insurance.
The introduction of General Data Protection Regulations along with several very high-profile cyber breaches including British Airways and Marriott Hotels, led many organizations to acquire cyber insurance, and premiums soon began to skyrocket.
Now in 2023, cyber attacks, data theft, ransomware and other breaches are a pervasive problem across business sectors including healthcare, manufacturing, and finance.
That rise has prompted a surge in costs in cyber insurance rates of up to 100% Year-over-Year, as according to Lloyds of London.
In the face of these escalating premiums, businesses, especially smaller ones, grapple with a conundrum: pay the higher premiums at the expense of investing the money into other areas of your business, or forego cyber insurance and risk the huge cost of an uninsured cyber breach.
Just as driving a well-maintained car, and demonstrating that you are a safe driver can lead to lower car insurance premiums, proof that your organization's digital assets and infrastructure have undergone pentesting and taking steps to remediate any issues it discovered, demonstrates that your organization is less likely to be successfully targeted by cybercriminals and therefore is a lower cyber risk.
Conducting routine, high quality pentesting will make your company a better cyber risk and lead to lower premiums.
There are several ways that pentesting makes your organization a better cyber security risk, and thus a candidate for lower cyber insurance rates.
Risk Reduction: Pentesting identifies and addresses vulnerabilities, making organizations less susceptible to cyber attacks.
Insurers may see organizations that invest in proactive security measures as responsible and less likely to experience severe cyber incidents.
Compliance with Standards: Many cyber insurance policies include requirements for organizations to adhere to specific security standards such as NIST, ISO27001, and SOC2.
It allows organizations to assess, refine, and continuously improve their ability to detect, respond to, and recover from cyber incidents.
While proof of pentesting can be a positive factor in your favor, it's important to note that premiums are calculated based on a comprehensive assessment of various factors, including the organization's industry, size, cybersecurity policies, and historical cyber incidents.
As cyber threats evolve, pentesting remains a vital tool in mitigating risks, securing financial stability, and ensuring cyber insurance affordability.
It serves as a proactive step that can directly influence cyber insurance premiums, showcasing a commitment to risk management and enhancing an organization's overall insurability.
Holistic Cyber is your partner in fortifying your digital defenses through pentesting.
This Cyber News was published on securityboulevard.com. Publication date: Mon, 11 Dec 2023 11:13:05 +0000