Less than a decade ago, the majority of businesses felt that cyber insurance was ridiculous, as they believed they had strong network security and expert IT professionals to safeguard them. Their tune has changed dramatically in a few short years.
Cyber insurance has become particularly popular among businesses throughout the last year and a half, according to the cyber insurance product division of Aon Corp., vice president Brian Rosebaum. He explained that ‘We’ve reached a threshold where people are now coming to us instead of us going to them,” Insurance News Report says.
The instance of high profile data breaches is on the rise, placing cyber risk in the spotlight, the article says. This has led to a surge in demand for cyber insurance products that would help keep losses caused by data breaches to a minimum.
Major losses, including those of Citigroup and the PlayStation Network, can be very costly – victims are required to notify their clients that their sensitive information has been compromised and must then offer credit management services, defend against lawsuits and hire a crisis management firm.
According to Rosebaum, Aon has now sold more cyber insurance policies in the last year and a half than it had in the five previous years, the article reports.