Computer crimes or computer security breaches cost American companies over $150 million in lost revenues every year. This includes theft of information, sabotage of data or networks, system penetration by outsiders, abuse of internet access, spoofing, viruses, financial fraud, active wiretapping, unauthorized insider access and theft of laptops. These hackers could be amateurs simply motivated by the challenge to crack a system, professional outsiders hacking to gain company information illicitly, or an employee hacker. Despite firewalls, computer security can be inadequate against hackers.
Why Hacking Insurance is Necessary
Due to increased hacking activity and flawed security, companies incur high financial and network damages. It becomes very important to take insurance policies specifically covering damages against hackers or protecting an e-commerce business.
Drawbacks of Existing Insurance Plans
Traditional insurance policies are inadequate against most aspects of crime damages due to computers. Their coverage is based on physical assets, not information assets. They rarely can define cyber risk coverage and even if they do, the breach in security is excluded. Intellectual property infringement, content and advertising offences over the Internet, employee dishonesty, and computer fraud are all mute terms for traditional insurance companies. They do not recognize business monetary loss, reduction, or shut downs due to computer crimes by hackers.
Advantages of Hacking Insurance
Most insurance companies have come to terms with recognizing the impact of technology on business in present circumstances. They have become more sensitive to online or e-commerce business risks and seek to cover them adequately.
Since 2000, a few companies are beginning to cover the computer security breaches. These companies address a host of e-commerce crimes like cyber extortion, content defamation, copyright and trademark infringement, viruses, theft, destruction, or alteration of data. They offer rewards for apprehending hackers and reimburse for post hacking crisis management. Many specialty insurers have come to the forefront to offer e-commerce protection packages.
The chief advantages are that some criminal behind the keyboard cannot destroy your business. Information gives companies a competitive edge in the global economy. It can be disastrous for the company, if the information is destroyed, stolen, virus infected, or divulged to competitors. Many insurers have started offering insurance products to protect companies from network breaches or virus attacks.
Additional Help
Cyber insurance is a potent weapon for improving Internet security. Cyber insurance products now being offered by insurance firms address the needs of e-businesses today. These types of insurance policies can be found online.
