Learn the Top 6 Requirements for SMBs to Obtain Cyber Insurance Coverage

Learn the Top 6 Requirements for SMBs to Obtain

Cyber Insurance Coverage

As we all know, data breaches and cybercrimes are on the rise, causing significant headaches and financial losses for businesses of all sizes. While cybercriminals often target large corporations, small to medium-sized businesses (SMBs) are equally vulnerable. In fact, 43% of cyber-attacks target small businesses, according to Verizon’s 2024 Data Breach Investigations Report.

Data breaches can severely damage your organization’s computer systems, reputation, and the safety of your customer and employee data. To mitigate these risks, many companies are turning to cyber insurance. This type of insurance can help cover the financial losses associated with cybercrimes and protect your organization’s liability in the event of a data breach. However, there are specific requirements your business must meet to obtain cyber insurance coverage.

Let’s review the top 6 requirements for SMBs to obtain cyber insurance coverage.

1. Training

With the rise in cybercrimes, cyber insurance premiums are also increasing. Since most cyber breaches involve a human element, having a cybersecurity awareness training program is crucial for obtaining cyber insurance. The more awareness we create about cybersecurity, the more likely we can reduce breaches.

Cybersecurity training begins with baseline training, which every employee with access to technology must undergo. This training covers essential cybersecurity information that employees need to stay safe and keep the company secure. New employees should receive baseline training as part of the onboarding process, while existing employees should receive additional training at least every six months. Continued training is critical as technology and hacker tactics constantly evolve.

Additionally, you should establish a Cybersecurity Workforce (CWF) program. This program identifies jobs and roles within your company that require more extensive cybersecurity training. Employees who work with regulated data or privacy concerns will need a higher level of testing. Key roles with access to personal private information, such as finance, executives and managers, HR/payroll, system administrators, and software developers, should be included in the CWF program.

Employee roles and their required training should be reviewed and adjusted annually. During your annual review, you might identify new roles or eliminate roles that are no longer needed. If an employee’s role changes, they will need to be assigned any additional necessary training.

Analyzing your team, defining CWF roles, and training can be daunting. Guide Star can help you establish and manage your CWF program.

2. Anti-virus

Antivirus software is a crucial component in protecting your systems. It’s essential to use modern antivirus solutions and avoid outdated technology and free antivirus tools.

Your antivirus software should have automatic virus definition updates enabled and these updates must be pushed to every computer managed by your IT team. Additionally, your IT team needs tools to ensure that corporate devices are receiving and installing these updates. This has become more challenging with the global increase in remote work due to the pandemic.

Guide Star offers an integrated approach to antivirus (AV) management and monitoring, providing your IT team with an easy solution for managing AV.

3. Managed Firewall

Much like antivirus, not all firewalls are created equal. Your firewall acts as your network’s primary line of defense from external forces, so if you are using end-of-life hardware or old versions of software, you are putting your systems at risk.

A firewall blocks a lot of bad traffic every day, so having a modern firewall with the capability to update automatically is necessary. Your IT team may need to test the new updates to ensure they are up to your standards, but once they have approved an update, the process for rolling out the change should be automated.

All network technology, including your firewall, also needs to undergo a regular patching routine. Additionally, it is critical your IT team has a strategy for proper network segmentation. Network segmentation means having controls in place where access to your network is layered. If someone were to breach your firewall, they would only be in one portion of your network instead of the whole thing.

4. Multifactor Authentication

Cyber insurance firms will always expect you to have Multi-Factor Authentication (MFA) in place. MFA is one of the best practices to protect business emails and networks, adding an extra layer of protection that can block most attacks originating from compromised credentials.

According to Microsoft, MFA is available to all customers with a commercial service subscription, but only 18% have it enabled. Microsoft also noted a significant increase in MFA usage during the pandemic, which greatly reduced compromises.

5. Email Management and Filtering

Email is the most commonly used entry point for hackers. Your IT team needs to implement technical controls to identify phishing emails and emails with malicious attachments or links, preventing them from being delivered to your users. Many major cloud email providers offer these capabilities, and your IT team should ensure that you have purchased and enabled this functionality.

White and black labeling works in tandem with an automatic email filter. If an email is flagged as suspicious but isn’t, your IT team can white label the specific email address or domain so that similar emails will bypass the filter in the future. Conversely, if someone receives spam or harmful emails that pass through your filters, your IT team can assign a black label to prevent these emails from getting through.

6. Backup and Recovery

Backups are an essential part of any cybersecurity program and can save an organization thousands of dollars, which is why insurance firms require a backup and disaster recovery plan. Backups prevent data loss in events like natural disasters or hacker attacks.

Your backups need to be automated and scheduled, as manual backups have a higher chance of failure due to human error or forgetfulness. Storing your backups in an offsite location, preferably in a different zip code, adds another layer of security. If your home office is destroyed by a natural disaster, like a tornado or hurricane, your backups will still be safe in a different location. Never store your backups on the same physical storage device as your systems, as compromising the device means losing both your systems and backups. Various cloud options are a great, low-cost alternative for storing and managing backups.

If you need help migrating to a cloud backup solution, Guide Star can assist.

Implement These Requirements Today

Cybercrimes aren’t going away anytime soon, which is why insurance carriers enforce these basic safety standards. These requirements are in place because many companies have viewed cyber insurance as a way to avoid improving their cybersecurity programs. In reality, a weak cybersecurity program causes more damage to your company and can harm your reputation and the safety of your employees and customers.

Taking the necessary steps to secure your systems can help prevent attacks and lower your insurance premiums. Guide Star has the resources to help you implement the above standards to obtain cyber insurance.

Contact us today to get started!