The certainty and severity of cybercrime has driven demand for insurance policies to cover the cost of damage when the inevitable occurs. Insurers, needing a clearer picture of clients’ risk so they can create policies and determine coverage, are turning to security ratings firms for help.
As technology has become more complex, so, too, have data breaches, explains Aleksandr Yampolsky, co-founder and CEO at SecurityScorecard. He points to the cloud shift as a turning point for cybersecurity.
“We started seeing an intensification of data breaches,” he says. “As a result, companies started calling insurance companies and asking for cyber insurance.”
Insurance companies started jumping into the budding space, offering policies to address demand. Now the industry is skyrocketing as companies transfer cyber-risk onto insurers.