Cyber Insurance 101: Why Cyber Risk Policies Are Taking Off

Although they have been around for over a decade, it is only recently that an increasing number of organizations accept cyber-incident insurance as a necessary business expense. According to the Ponemon Institute, a leading think tank that tracks and quantifies the economic impact of cyber-attacks, the average cost to an organization for cybercrime was $3.79 million in 2015 – an increase of 23% over the past two years.¹

Several high-profile cybercrime cases have garnered the attention of the media and consumers alike. For example, Target Corp. suffered a breach that cost the company over $162 million in expenses and affected 70 million customers. Similarly, more than 56 million Home Depot customers had their credit cards exposed to hackers. Upwards of 50 lawsuits have been launched against the company since they disclosed the breach in September 2014 which has cost the home improvement giant approximately $232 million to date.