If you’re a business that uses digital systems for managing confidential data, you should consider investing in cyber insurance. However, you shouldn’t stop there. To identify and fix security vulnerabilities across your digital footprint, it is recommended that you perform a thorough IT risk assessment first. This will provide you with insights to help fix IT security loopholes and potentially reduce your cyber insurance and security costs.

The Purpose of IT Risk Assessment

Auditing your IT risks has multiple benefits, including:

  1. Determining Your Threat Profile

    To come up with a solid mitigation strategy, you need to first understand your IT risk profile. Proper risk assessment will help you determine the following threat characteristics:

    • What are your IT security threats and their internal/external sources?
    • What is the reason for the identified threats or vulnerabilities?
    • What is the probability of each threat materializing?
    • What is the potential impact/damage to your organization if a threat materializes?

    After determining your IT risk profile, you can prioritize high-probability risks and identify mitigation solutions to help avoid potential losses in the future.

  2. Highlighting and Patching Vulnerabilities

    IT risk assessment can help to pinpoint key security vulnerabilities that require fixing. The objective is to identify security loopholes that any remote-based or local “bad actor” might successfully exploit to breach your IT system. Be sure to test your network’s defenses using ethical hacking techniques. Your firewalls, password security, endpoints, antimalware, and other protocols or tools should also be tested regularly. Based on your findings, you can develop and implement practical solutions to help improve your overall IT security.

  3. Auditing Your Digital Footprint

    You must be able to track and inventory all of your digital assets and assess their importance to your business operations. Threats like distributed denial of service (DDoS) attacks will be targeting your software and endpoints, so you’ll need to know where each device or system is implemented or deployed and how to secure it. Determine your mission-critical digital assets both on-premises and in the cloud and help protect them against hacking, malware infection, and other types of data breaches.

  4. Minimizing Breach Costs

    Assessing your IT risks on a regular basis allows you to deal with threats proactively. This way, there may be fewer security incidences within your network, potentially eliminating unnecessary security spending. Also, an understanding of your risk profile enables you to optimize your IT security budget by spending more on threats with potentially devastating effects. Remember that insurance underwriters will incorporate your cybersecurity efforts in their calculations for your insurance premium. You may be able to lower your cyber liability insurance premiums in two key ways:

    • Demonstrating to potential insurers that you have maximum IT security in place
    • Reducing the number of IT security incidents (claims) impacting your organization
  5. Complying with Data Protection Rules, Regulations and Laws

    Without carrying out a comprehensive IT risk audit, you may not know whether or not you’re complying with relevant privacy and data security regulations. For example, if your organization handles any health records, you’ll need to protect your systems as per HIPAA requirements. This applies to data stored on on-premises servers and in the cloud, as well as hard copy data such as paper files. For enterprises with information systems or web portals serving European customers or clients, GDPR compliance is mandatory. When you investigate your data compliance levels, you may be able to identify and fix any shortcomings before it’s too late. Most data protection rules impose hefty penalties for non-compliance.

To find the right cyber liability coverage for your needs, talk to the team at Tompkins Insurance Agencies today. We look forward to helping you find the right options for your insurance needs.