Cyber Policy Renewals More Difficult In a Tightening Market
Posted by G. Suggs Insurance Agency, Inc. on
Last year was a good one for hackers. 2021 saw a massive increase in cyber attacks, with IBM reporting (See Cost of Breach Report) the average cost of a breach hitting an all time high of 4,24 million. If your business has a cyber policy, it is important to be prepared well in advance of your next renewal. Cyber insurers across the board are increasing premiums and often reducing coverage at the same time. There is an increased chance that your cyber insurer may even decline to renew if recommended preventive measures are not enacted. Here are a few things to keep in mind about your upcoming renewal:
Be prepared to start the renewal process as early as possible. Cyber insurers are very busy and may be slower than usual in getting renewal terms and conditions in place. It would be a good idea to contact your cyber insurance agent to see how early you can start the renewal process. 60 days prior to the renewal date should be sufficient for most businesses; 90 days if your organization is larger and in a data intensive industry, like healthcare.
Expect increased preventive measures to be required in order to secure your cyber renewal coverage. Cyber insurers want to help you avoid a breach, as opposed to cleaning up the damages after a hack has occurred. There is a likely chance your insurer will have specific IT requirements you will need to adopt in order to qualify for coverage. It would be a good idea to give your IT provider a heads up that your cyber policy is coming up for renewal, and that you may need to get them involved to help comply with pro- active defensive measures.
Once you have your renewal offer in hand, go over the terms and conditions to make sure you are satisfied your policy is the best combination of cost and benefits. As mentioned earlier, you may be offered higher deductibles along with higher premiums and possibly may only qualify for lower limits than in the past. Confer with your agent to decide if the offer is worth renewing, or should you possibly get comparisons with other cyber insurers.
Remember- cyber insurance providers are looking for clients who activate security measures in hopes of preventing a breach. Pro-active work with your IT department or vendor and cooperation in implementing your cyber insurers’ recommendations will yield the best results in renewing your policy.