While companies seek to protect themselves against losses from digital attacks, policies aren’t solving the problem.
If there is anything that companies have had to come to accept, it is that cybercrime is real and one of the best ways that they are able to protect themselves against the losses associated with those digital attacks is through cyber insurance.
However, the coverage is currently dealing only with the symptoms of the issue and not the problem, itself.
At the same time that companies are using cyber insurance to protect themselves against the types of losses connected to a data breach, a report from Bloomberg has shown that they are focused almost exclusively on the consequences of those attacks and not on the causes of them. It speculated that the purchase of coverage against cyberattacks, it is an easier and more direct way for companies to feel as though they are doing something about this issue. Still, the underlying problem remains.
Cyber insurance has grown considerably in popularity after a broad spectrum of high-profile attacks.
Hundreds of millions of customers have had their private and financial data compromised through attacks on giants such as Target, Home Depot, Sony, and even a range of different insurance companies. Still while businesses flock to make sure that they have coverage, they have done comparatively little to address the “secrecy that surrounds the issue,” said the Bloomberg article.
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The first quarter of this year came with an increase in demand for this type of insurance coverage by 50 percent, when compared to that same quarter in 2014. New customers are requesting these policies for the first time, while existing customers are increasing the amount of coverage that they have as they gain a better understanding of what could possibly happen to them if they were ever to be a victim of one of those attacks. It is becoming more widely understood that the expenses associated with a data breach are strikingly high.
An estimate from cyber insurance provider Marsh & Mclennan has stated that last year, there was a doubling of the market for that product in the United States, bringing it as high as $2 billion.