With technology constantly being updated in the world of banking, helping customers have a better user experience, cybersecurity has now been brought to the forefront of risk issues. While data and network threats have been around for some time now, it’s the more sophisticated level of execution from hackers that has financial institutions worried.
Banks should do their due diligence by investing in bank cyber insurance, which can protect a bank’s assets as well as its customers’ sensitive financial information. However, there is still a lot to be uncovered in the world of cyber insurance for banks as there isn’t a one-size-fits-all approach to keeping information safe.
Not Created Equal
Insurance programs for banks to protect against cyber attacks are not all made to provide the necessary level of reimbursements in the event of financial loss. Legal questions have come up, causing confusion to financial institution execs. There are a lot of variables that come into play for banks looking for a fully fleshed out insurance program in terms of what’s covered and what isn’t.
Even though cybersecurity insurance has been around for more than two decades, it’s only been in recent years that banks have seriously implemented it. This is due in part to technology being so easy to use to gain information as well as advances in technology for the sake of customer experience.
Covering Losses
The steep rise in cyberattacks has banks on the ropes, trying to figure out what to do to get ahead of hackers with advanced methods. One way banks are safeguarding their assets is by investing in policies meant to help in times of crisis. There have been a number of banks and credit services hit by attacks in recent years and insurance coverage has seen a rise.
Since this is the case, banks should do their best to understand that their current coverage may need a refresher. While it’s good to have coverage implemented, it pays off even more to make sure reimbursement levels are enough to cover big losses. Some banks may not understand the severity of financial hits they can take as a result of a cyber attack, thus having adequate coverage will add peace of mind and the right education needed to be protected.
No Additional Coverage
The idea that attaching a general liability policy to provide necessary protection is a misinformed step. In reality, it’s uncommon for banks to have a cybersecurity policy on top of their general policy. This is what has led to so many losses and vulnerabilities in the financial institution market. Operating without the proper coverage puts you and your customers at a higher level of risk. Make sure to review your policy and look into coverage plans that explicitly outline cybersecurity issues.
About Financial Guaranty Insurance Brokers
Since 1983, Financial Guaranty Insurance Brokers has distinguished itself as a provider of Professional Liability, Cyber Liability, and Crime insurance products for entities of all types. To receive timely, personalized service from a knowledgeable and experienced staff, call us today at (626) 793-3330 to speak with one of our professionals.