As the world continues to become increasingly reliant on technology, a new breed of threat has emerged. The Internet is rife with scams and a vast array of dubious activities. It is also home to some of the most skilled and tenacious hackers. This fact has led many insurance companies around the U.S. to start offering insurance protection against what they are calling “cybercrime.” The majority of these policies are tailored for big companies, but they have not received the interest insurers thought they would.
Cybercrime is a real issue, this much is certain. Two weeks ago, Sony Online Entertainment was attacked by hackers and the personal information of more than 3,000 customers was stolen. This information included names, addresses and credit card number. Today, SOE announced that yet another breach in security has occurred, reporting that information from an old database from 2007 has been stolen. Should this information be used maliciously, SOE stands face a serious financial risk from which it will take years to recover.
Insurance companies are beginning to offer comprehensive coverage options to companies that store customer information electronically. However, many big businesses are dismissing these multimillion dollar policies. Instead, they are opting to take matters into their own hands by developing in-house methods to mitigate the threat.
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Officials at Towers Watson, a leading risk management service for the insurance industry, say that companies choosing to forgo insurance coverage are nothing but arrogant. The nature of the online world is constantly evolving. Hackers find new ways around security measures every day and companies simply have neither the manpower nor the budget to keep an in-house IT staff working around the clock.
Given the events that have happened with Sony, more companies may be changing their mind about cyber insurance.