Cyber risk, top priority for SMEs and self-employed workers
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When it comes to purchasing a new vehicle or buying a house, it is not surprising that one of the first ideas that comes to mind is taking out insurance. It is normal for us to think about insuring our most valuable properties and covering ourselves against the possibility of theft or an accident.
Even when we buy the latest model of mobile phone on the market, we consider paying an extra “just in case.” But sometimes we forget to apply these important aspects such as technological security to our company. For this reason, it is important to know what cyber insurance is and its relationship with the risk management of your company . What is the current situation of your company in the area of computer security? If you are still taking the first steps to implement a Security Master Plan , in this link you will find support material for its evaluation and preparation. In the first phase, the identification of cyber risks is included, essential information, prior to contracting cyber insurance or cyber risk insurance.
What is cyber insurance?
According to the report published by ENISA Commonality of risk assessment language in cyber insurance , cyber insurance is a means of protection against loss and a form of risk management related to the Internet, to the infrastructures and activities of a company’s information technology. It is used to prevent future uncertain loss linked to these risks.
Cyber insurance, or cyber risk insurance, works like any other type of insurance product, but in this case, in the field of cybersecurity.
Cyber insurance offers an extra layer of protection to the preventive cybersecurity measures that we should already have implemented in our company, but it should not, under any circumstances, replace them.
As with any other type of insurance,
Cyber risk insurance should cover not only the economic impact of the attack itself, but also take into account other circumstances arising from the incident.
This is an insurance product whose purpose is to protect SMEs and self-employed workers not only from the direct impact of a cyber attack, but also from the consequences that these can have on the business. Or to put it another way, it is logical to think that our car insurance not only pays for the repair of the damage caused by an accident, but also provides us with a replacement vehicle while ours is in the workshop. Therefore, cyber insurance should cover everything from the investigation of the cybercrime to the recovery of stolen data, compensating for the loss of income and managing the company’s reputational risk. In this regard, taking out cyber risk insurance can give us the peace of mind of knowing that, if the other protection measures fail and our company suffers a cyber attack, we would have a large part of the associated losses covered.
Should I get cyber insurance?
There are undoubtedly essential and critical factors that must be addressed and resolved in the business strategy of an SME and a self-employed person, which may justify the purchase of cyber insurance.
They are grouped into two main blocks:
Regulatory pressure on SMEs and self-employed workers due to recent legislation published by the European Commission, which is binding on all Member States in terms of cybersecurity and data protection. You can access more information here:
The General Data Protection Regulation or GDPR: through cyber insurance, you can access advice and compliance with this legal regulation on data protection. Giving rise to a risk coverage against possible threats of data theft from our clients, suppliers or company personnel or non-compliance in the application of this regulation in the information systems of our company.
As an example of the importance of this regulation
Large corporations are including the contracting of cyber insurance in their business strategies, an initiative led by the Chief Information Security Officer (CISO) in large organizations as an additional mechanism for cyber risk management. Legal compliance in this matter allows us to generate greater confidence in our clients, suppliers and any entity linked to our company, thus improving its reputation.
The NIS2 Directive ( Network and Information Systems ), approved on December 27, 2022, where the number of sectors and activities that must comply with this regulation is expanded with respect to the previous NIS Directive. This Directive regulates greater cooperation and management of cybersecurity risks between organizations belonging to these sectors, such as energy, transport, health, food production, processing and distribution, and digital service providers. Having 21 months from its publication for its transposition into national legislation and through the contracting of cyber insurance, it would be possible to have legal advice and know the implications that this Directive will have on our company.
