A note from our Executive Editor and Publisher Martin Hinton – Reposted from Linkedin
Perhaps you’ve been wondering about all my reposts from Cyber Insurance News and Information. Allow me to explain in a historical context.
First, Cyber Insurance News and Information is a content solution from our company Rhetorical Ronin. Our feeling is simple. In 2020, according to Marsh, about $7 billion was spent on cyber insurance globally. Depending on what projections you look at, by 2030, that amount is expected to rise to as much as $84 billion. Why is the amount going up? Because of the danger. The Center for Strategic and International Studies estimated that cybercrime cost businesses and individuals $450 billion in 2013. What is the estimate for losses in 2023? According to a report by Cybersecurity Ventures, the figure is $8 Trillion. By 2025 their estimate puts the figure at $10.5 trillion.
Any industry this large and vital to global commerce deserves a dedicated, pure-play news source. We are it, regardless of your organization’s size, role, or relationship to cyber insurance. From cyber liability insurance, cyber insurance for small businesses, and cyber insurance premiums, to the latest digital threats and cyber security innovations, you can count on us for actionable news and information on the industry.
As we place more and more of what we value in digital places, bad actors will seek to take what is ours for their gain. In this nascent realm, insurance and security are intertwined. As companies large, medium, and small face this threat, they also exist in a reality where what was secure today may not be secure tomorrow. Security is a perishable commodity. Vigilance and information are essential.
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As for the historical context, consider The Wild West. Early banks were makeshift facilities. Maiden security measures involved building brick and stone structures. Like the maiden name measure of early digital security, the thieves evolved as the barriers to their booty evolved. As we intend to rely on various AI platforms to enhance our site, I’ll let it take over from here (with a heavy, needed HI edit).
In the vast expanse of the digital frontier, where the tumbleweeds of data blow freely across the virtual prairie, a new sheriff has ridden into town. The sheriff’s name? Cybersecurity and insurance. It’s the Wild West of the 21st century, and just like the 1880s when banks were popping up faster than a cactus after a desert rain, our digital landscapes are teeming with bits and bytes of valuable information.
Back in the days of cowboys and six-shooters, banks were simple, just like a lone password with no “@%@$%@$%” requirements or the aforementioned mother’s maiden name that’s easily found online. You can almost hear the creak of the saloon doors as people entrusted their hard-earned gold and silver to these rudimentary establishments. But, much like the lone stagecoach guarded by a shotgun-wielding cowboy, those early banks needed more than a “keep out” sign to keep the varmints at bay.
Fast forward to the cyber age, and we find ourselves in a similar situation. The rise of cyber threats mirrors the Wild West’s notorious outlaws, riding into the digital town to plunder passwords and ransack sensitive information. Enter the new sheriffs in town—cybersecurity experts armed not with six-shooters but with firewalls and encryption.
Just as the banks of yesteryear had to evolve, so too must our defenses against the bandits of the digital age. In the 1800s, bank vaults and safes were introduced, which brought a sense of security to frontier towns. Today, it’s the complex algorithms, biometric or two-factor authentication, and state-of-the-art encryption that stand guard over our digital treasures.
But the analogy doesn’t end there. In the aftermath of a bank heist, what did some folks turn to? Insurance. However, policies were hard to come by and expensive as a result of the risk of robbery. Fast forward to today, and the rise of cybers insurance is akin to the insurance policies that protected the banks of the Wild West. It’s a digital indemnity against the virtual bandits and highwaymen who seek to pillage our data. But, the level of security at many organizations of every size is lacking. That leaves them, in simple terms, uninsurable. According to a 2023 report by Hiscox, approximately 18% of American companies have cyber insurance but do not use it. Perhaps the deductible was onerous. Perhaps their security measures failed to meet the demands of their policy. On the quality of an organization’s security, A 2023 GAO report stated, “…approximately 20% of American businesses are unable to obtain cyber insurance.” Taking these two points of data, we see that almost 40% of American enterprises are entirely on the hook for the financial loss of a cybercrime.
Is this liability survivable? If we compare the financial cost of recovering from cybercrime to other liabilities, an interesting idea appears. A 2023 study by Harvard Business School found that 80% of businesses fail within 18 months of a major lawsuit. In the case of a data breach and evidence that safeguards weren’t appropriate, a company faces a two-pronged assault. Once for the cost of recovering from the crime, legal fees, ransom, and IT upgrades. Then they pay again if customers file claims for the damages they suffer.
It is, to say the least, a complicated industry. But as a journalist and TV producer, for decades, I’ve made a career of taking the complex and making it a story, or at least making it easy to understand. From the Affordable Care Act to identifying the military crest of Hamburger Hill while standing on the hill itself, I believe there is a way to bridge the knowledge divide. So, saddle up, partners. The cyber frontier may be wild, but with the right security measures and cyber insurance, we can still ride into the sunset with our data intact and our virtual spurs jingling.
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Martin Hinton is the executive editor and publisher of Cyber Insurance News and Information.
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