A Cyber Insurance and Business Resiliency Guide

Effective Methods For Dealing With The Aftermath of a Cyberattack

Data has become the engine that empowers businesses in the 21st century. This invaluable asset informs critical business decisions and processes across an organizational value chain. However, this business asset is under a continuous attack by malicious actors seeking to impact critical business infrastructures. Therefore, to ensure higher levels of incident response countermeasures and business resiliency, small to midsize businesses must embed cyber insurance into its enterprise disaster recovery plan.

While data breaches at Fortune 500 companies continuously dominate news headlines across America, more than 28 million small businesses remain the primary target of cyberattacks. Small to midsize businesses (SMBs) in America employ close to 56 million employees, therefore the exploitation of critical infrastructures that are controlled by small business is bound to cause long lasting effects. Unfortunately, the lack of resources and proper awareness cause many SMBs to underestimate the effects of the exploitation of vulnerability within an organization’s infrastructure.

Some of the effects of cyberattack include the disruption of revenue generating activities; compromise of clients’ sensitive information; regulatory compliance fines; and much more. Although the rate of exposure to a cyberattack appears similar between SMBs and large corporations, the latter is more equipped to maintain the confidentiality, integrity, and availability of its critical business functions. Therefore, to defend against cyber-threats and achieve business resiliency, cyber insurance must be baked into enterprise disaster recovery plans.

The Quantifiable Outcome of Cyberattack on Small to Midsize Businesses

In the Information Age, businesses that lack strategic plans to deal with information security risks are doomed. Over the years, we have witnessed the decline of several small to midsize businesses due to the lack of resources required to eradicate some of the compounding effects of cyberattacks. These cyberattacks oftentimes cripple business integrity and damage clients’ trust, and interrupt revenue-generating operations.

Source: 2020 Cybersecurity Statistics by Comparitech

According to Gartner, the average cost of IT downtime, due to a major cyberattack in a small to midsize company is around $5,600 per minute or $300,000+ per hour – for larger organizations, that figure tops half a million dollars. However, as cybercrime continues to increase, as much as 60% in 2019 alone, organizations across every industry are investing heavily into detective, preventive, and corrective security controls.

Unfortunately, in the corporate expense sheets, cyber insurance countermeasures are nowhere to be found. Cyber Insurance, similar to top-tier firewalls, serves as a measurable control that is implemented to assure business operations in the aftermath of a cyberattack.

Five Effective Methods For Dealing With The Aftermath of A Cyberattack Against Small to Midsize Businesses

The activities of an organization after a cyberattack determines the future of said organization. Whenever an organization becomes the victim of a cyberattack, an aftermath playbook takes effect depending on the geographical location of such a cyberattack. The aftermath playbook is often called the ‘incident response plan,’ some of its contents include the notification of affected parties; cyber forensic investigations; public relations damage control, etc.

Cyberattacks can pose a number of negative implications for an affected organization, ranging from hefty regulatory compliance fines to reputational damages of customer trust and loyalty. At Goldsky Security, we understand the emotional, economic, and legal implications of a cyberattack, especially for SMBs. Therefore, our cybersecurity experts have compiled a comprehensive and practical guide below to help SMBs recover from cyber exploits and regain control of its critical business infrastructures and operations:

    1. Develop a Computer Incident Response Team (CIRT)filter-out the most skilled and experienced employees within your corporate information security team, and assign them roles and responsibilities aimed at properly assessing the effects of a cyber incident. For the best results, the CIRT team must be composed of individuals with diverse expertise and specializations.
    2. Restore Backupsregularly create backups of critical data, to ensure a rapid recovery in any case of a natural or manmade disaster. This backup data must be stored off-site and accompanied by redundant measures.
    3. Quarantine the Compromised Systemsduring and after a cyberattack, identify all targeted and compromised systems and implement segmentation procedures to preserve the integrity of non-affected systems. System segmentation and quarantine entails isolating affected systems from corporate networks to avoid the spread of infective agents.
    4. Notify Affected partiesto maintain good reputation and respectable public relations, a measured public transparency is necessary. Ensure to contact all customers, via email, official letters, and publication, about the incident and reiterate the recovery measures that are being implemented. Lastly, providing data security and privacy tips for personal safety is advisable.
    5. Reinforce Lessons Learnedconsider every incident as a lesson to be learned. Understanding what worked, what did not work, and what could be better is an excellent way to improve business resiliency in the face of increasing cyberattacks.

Achieving Business Resiliency Through Cyber Insurance

Business resiliency is simply the ability of an organization to quickly adapt to risk, without experiencing disruption to business assets, equity, and/or operations. Cyber insurance creates a network of prevention and recovery efforts that are deployed to help stabilize an organization during and after the executive of disaster recovery plans. It is critical that SMBs collaborate with competent cybersecurity professionals to help develop robust risk management policies that embed cyber insurance elements on an organizational level.

To understand how cyber insurance contributes to the achievement of business resiliency, the cyber security experts at Goldsky Security have prepared the following key points:

  • Business Interruption – Although the average cybersecurity policy briefly highlights disaster recovery plans, cyber insurance ensures limited interruption to business operation. This is achieved by negotiating a cyber insurance policy that covers the loss of revenue; operational expenses; damage repair expenses; and cost for disaster recovery procedures.
  • Privacy Infringement Claims – If data is lost or its integrity is compromised as a result of a cyber-attack, businesses may need to notify customers and regulators. These mandatory reporting procedures may lead to privacy infringement claims, which is usually followed by lawsuits and fines. A cyber insurance policy may be set up to cover these costs, without placing an unexpected financial strain on businesses.
  • Ransom Payments – In a ransomware attack, malicious actors demand businesses to remit funds, prior to the release of critical organizational systems and data. Based on the cyber insurance policy in place, said ransom can be paid off by an insurance company thus, allowing affected  businesses to regain normalcy.
  • Forensic Support – Most cyber insurance policies give enterprises access to quality incident response specialists in the event of a cyberattack. These experts collaborate with IT teams to assess the damage, conduct forensic investigations, and recover lost confidential data in near real time.
  • Information Security & Privacy Regulations – The presence of a cyber insurance policy within an organization’s risk management arsenal signals to regulators that due care and due diligence has occurred. For industry regulations, such as HIPAA and GDPR, cyber insurance creates a baseline of reasonable adherence to data security and privacy best practices.

Final Words

Cyber insurance plays a crucial role in building business resiliency, and it is a critical part of a comprehensive cybersecurity framework. The benefits are not just limited to the valuable financial information protection in the event of a cyber-attack, but it also provides access to on-the-ground support from IT specialists and expert consultants in the aftermath of a cyberattack. As businesses operations rely on information technology, cyberattacks will become more sophisticated and dangerous. Thus, SMBs must conduct a cost benefit analysis and decide whether the purchase of a cyber insurance coverage is in their best interest. Afterall cyber insurance can also play the role of a compensating control for enterprises to protect their finances and build customer trust.

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