Businesses in Vancouver and the world over face significant financial risks following data breaches and cyberattacks. This means cyber insurance is no longer optional — it’s a crucial financial shield that can cover high recovery costs, legal fees, and more. However, to obtain affordable coverage, businesses must comply with certain cybersecurity requirements.
How do Vancouver businesses qualify for cyber insurance?
Essentially, insurers evaluate Vancouver businesses’ cybersecurity practices, and failing to meet these standards could lead to higher premiums or difficulty securing coverage. Here’s a breakdown of key areas insurers focus on:
Security policies and procedures
Insurers want to see that you’ve implemented robust security measures. This includes having clear policies for data storage, encryption, and compliance with security regulations.
- Data storage and encryption: Insurers assess where your sensitive data is stored and what measures you have in place to protect it, which should include physical security measures for data centers and cloud storage. Data must also be encrypted in transit and at rest to guard against unauthorized access.
- Compliance: Meeting industry standards such as PIPEDA, PCI DSS, or GDPR, is often required. These regulations impose strict data protection guidelines, and noncompliance can lead to denied coverage as well as legal penalties.
- Security services: Insurers assess the effectiveness of your security tools, including intrusion detection systems, firewalls, and antivirus software. They may also review the percentage of your IT budget allocated to security; too little may be interpreted as a lack of commitment to security, so it’s important to allocate resources appropriately.
- Patch management: Insurers expect regular patch management and updates to address vulnerabilities in software that cybercriminals could exploit.
Access controls
Weak access control can open the door to cyberattacks, making it a top priority for insurers evaluating your cybersecurity practices. Therefore, to qualify for cyber insurance, your business must implement strict policies that limit access to sensitive information according to employee roles and responsibilities. This means only those who absolutely need access to critical data should have it, reducing the risk of unauthorized access or data breaches.
To that end, strong password policies are essential, with insurers often requiring the use of complex passwords that are regularly updated. Multifactor authentication (MFA), which involves providing additional forms of verification during login, is another common requirement, as it adds an extra layer of protection. Insurance companies also expect your business to establish clear protocols for removing access when employees depart your organization. Immediately terminating their access to systems and data helps prevent any potential security breaches after their departure.
Incident response plan
Insurers expect businesses to have a well-prepared incident response plan to address security incidents effectively. Key elements of this plan include:
- A dedicated incident response team: This team is responsible for coordinating the response to a security incident, ensuring that appropriate steps are taken to contain the damage and recover from the attack.
- Clear procedures: Your plan should detail precise procedures for detecting and addressing security incidents. It should encompass steps for containing breaches, restoring systems and data, and alerting affected parties.
- Regular testing: It is critical to regularly test your incident response plan to ensure it works and to keep your team ready to respond effectively to security incidents.
Backup and disaster recovery
Insurers typically require businesses to have robust plans for backing up data and recovering from disasters. To meet these requirements, it’s essential to establish a regular schedule for backups, ensuring that a recent copy of your data is always available in case of loss. Additionally, you must store backups securely, both on site and in the cloud, to protect against unauthorized access or damage.
However, for insurers, having a backup plan alone is insufficient. Businesses must also regularly test their backup and recovery procedures to confirm that they function as intended and that they can restore data promptly when needed. By implementing these practices, your business demonstrates to insurers that it is well prepared for potential disruptions and committed to safeguarding its data.
If your Vancouver business is looking to qualify for cyber insurance but you aren’t sure where to begin, reach out to us at Technikel Solutions. Our IT experts are here to help you understand the risks and vulnerabilities your business faces, and we can work with you to develop a cybersecurity plan that meets the requirements of your insurance provider.