InTents December 2021/January 2022 - 46

business | safety
Insurance
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The question of whether traditional insurance
policies provide coverage for losses
due to cyberattacks and cybersecurity
breaches is, at least temporarily, yes. A federal
court in Maryland recently ruled that an
insurance company must cover the costs of
software, data, computers and servers that
were lost or damaged by ransomware under
the property insurance coverage of one
business owner's insurance policy.
However, business interruption insurance
can help the business regain only
some of the inancial loss resulting from
a security breach. Yet, without business
interruption insurance an operation could
not make up any income lost due to the
disaster-the ransomware attack.
To protect against cyber risks, many
businesses are beginning to add cyber or
cyber liability coverage to their business
insurance policies. So-called data breach
insurance helps a business respond to
breaches and usually offers suficient protection
for most small businesses.
Cyber liability insurance, on the
other hand, is typically used by larger
businesses and offers more coverage to
help prepare for, respond to and recover
from cyberattacks.
It should be noted that most cyber
policies require that a business receive
permission from the insurance company
before any ransom amounts are paid. And
remember, although most cyber-related
insurance policies provide reimbursement
for a ransom payment and related expenses,
they don't pay these costs up-front.
The cost of ransomware
Since payment of a ransom does not guarantee
the operation's computers or data
will be unchanged after their release, expenditures
to restore, replace or reconstruct
programs, software and data are
often necessary. And don't forget there are
other extortion-related expenses including
the cost of hiring a security expert for
46 intents dec 2021-jan 2022
advice on responding to these threats to
ensure they don't happen again.
Avoiding the inevitable
While it is frightening to think that nothing
can be done when faced with a cyberattack,
being prepared for the potential lost
revenue/income during downtime due to
an attack is as important as preemptively
assessing what cybersecurity measures
are already in place.
Ransomware attackers, indeed all
malware distributors, have grown
increasingly savvy, requiring users to
exercise extreme caution about what
is downloaded or clicked on. Other
measures for reducing the risk of
potential ransomware attacks include
keeping operating systems, software
and antivirus programs up to date, and
backing up data regularly.
The endgame
Since it is virtually impossible to completely
eliminate the risk of a ransomware attack,
ransom payments are often the best option.
Targeted businesses, organizations and
even governments may feel paying the
ransom is the most cost-effective way to
get their data back.
Preparedness only goes so far in protecting
against these sophisticated attacks.
Tax deductions can offset a portion of the
cost of ransomware attacks while insurance
is available to help ease the pain.
Bottom line is the question of what is the
most cost-effective strategy? Does funding
these cybercriminal organizations, in
essence helping them proliferate and grow
increasingly more sophisticated, outweigh
paying ransom for the promise of restored
computer systems and unlocked data?
This is something to consider before
an actual ransomware attack affects
your company.
Mark E. Battersby writes extensively on business,
fi nancial and tax-related topics.
http://www.InTentsMag.com

InTents December 2021/January 2022

Table of Contents for the Digital Edition of InTents December 2021/January 2022

InTents December 2021/January 2022 - Cover1
InTents December 2021/January 2022 - Cover2
InTents December 2021/January 2022 - 1
InTents December 2021/January 2022 - 2
InTents December 2021/January 2022 - 3
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