There’s a growing concern highlighted in the Wall Street Journal regarding cyber liability insurance and how it’s overlooked by corporate boards. This risk isn’t limited to Fortune 500 companies; even smaller entities with executive boards may be neglecting it.
Tech Decisions and Board Disconnect
In many companies, executives making strategic decisions often lack technical backgrounds. While IT and cyber departments manage technical aspects like websites and coding, their input might not directly influence high-level strategic decisions.
Lack of Cyber Expertise in Boards
Surprisingly, a mere two percent of directors in S&P 500 companies possess professional cyber security experience, even though these companies boast extensive IT departments. With heightened scrutiny of security failings, this lack of expertise becomes a critical issue.
Accountability Amid Cyber Failures
When a security breach occurs, boards without cyber security expertise face questions and potential blame. Whether on the board or at an executive level, accountability extends to understanding preventive measures like cyber liability insurance and standard protocols.
Beyond internal expertise
While internal IT and cyber teams excel, they may not cover the breadth of evolving cyber threats. Cyber insurance underwriters, equipped with global knowledge of cyber attacks, provide an added layer of protection by foreseeing and safeguarding against emerging threats.
Business strategies and cyber integration
Cybersecurity often remains a peripheral concern in broader business strategies. Failure to integrate it into business development, capital management, and regulatory compliance can lead to substantial losses and liabilities.
Rising Risks and Changing Landscapes
The risk landscape is rapidly evolving, with hackers devising new methods to breach systems. Recent cyber attacks on major establishments like MGM and Caesars in Las Vegas emphasize that no company is immune.
Taking Action and Seeking Knowledge
Recognizing this growing risk is the first step. Seeking expert guidance, understanding evolving cyber threats, and implementing robust cyber security measures are crucial for mitigating liabilities and losses.
Remember, staying informed and proactive is key in this ever-changing cyber threat landscape. For more insights, visit riskcoverage.com.