As per a report by EY, 2020 saw an unprecedented rise in the number of cybersecurity attacks on businesses, especially insurance companies, where the industry suffered ransomware attacks- more than 200% more than the previous year. One of the main reasons probably is because the pandemic forced organizations into ad-hoc measures that bypassed cybersecurity protocols.
Everyone needs some kind of insurance and because of this insurance sector is one of those that has accumulated huge amounts of data, especially sensitive information. And storing such large amounts of information about their policyholders, makes them a target for cybercriminals. And this is only expected to grow in frequency and severity.
Cybersecurity within the insurance industry is vital because of the industry’s size and scope and the vast amounts of data consumed by companies in this sector. Patching up legacy systems leaves this sector vulnerable to cyberattack.
Earlier several insurers preferred their on-premise insurance systems to cloud hosting as they believed they had tighter control over the former, allowing them to regulate security measures better. But they have had to shift to the cloud thanks to the hybrid working models that were necessitated by the pandemic as well as the digital transformation that most insurers are undergoing.
Reputation being one of the key factors for an insurance carrier, a highly publicized cybersecurity breach of customer data can undermine an insurer’s reputation and have severe repercussions in the marketplace.
So here’s how cloud can improve cybersecurity for insurance companies.
With cloud, businesses can be assured that their security is constantly being monitored and upgraded. And most cloud providers have a dedicated cloud security team that is constantly identifying threats and closing loopholes. This proactive approach and sophisticated cloud security measures minimize the risk of cyber hackers compromising data.
Comprehensive Data Protection
Cloud security measures can protect data at rest and in transit through cloud data security features like encryption and multi-factor authentication. Encryption ensures that cyber hackers cannot decode data even if they do get access to it, while multi-factor authentication ensures that only users authorized to access the data can view it.
Stringent Access Controls
Role-based access is another way of ensuring that users only access what they are allowed to. This is a great way to ensure that junior employees as well as different departments cannot view data. And this to a great extent can mitigate both malicious use of data as well as hacking an organization’s data. Role-based access also comes in useful when an employee’s access needs to be revoked fast.
In the case of on-premise security setups, tracking down the source of the leak and the extent of information that was leaked could be a long-drawn-out process. But with clouds, every action taken leaves a digital footprint. In the event data is compromised, stakeholders will get alerted immediately and can access details thus helping to identify and prevent data leakage and rectify issues much faster and minimize damage.
With the pandemic and tighter budgets, cloud allows insurance carriers to free up their resources as cloud security is an in-built function and public cloud providers take care of maintenance and upgrades. Thus, cloud allows cost cutting by eliminating dedicated support teams, lower the cost of IT maintenance, strengthen cybersecurity, and prevent malicious attacks that can cause damage to a carrier’s reputation.
Employing AI can significantly help insurance companies protect against malware and ransomware, as it becomes possible to quickly and efficiently analyze large amounts of data and detect any deviation from an expected pattern in data behavior. They can be used to monitor data workflows and respond to attacks immediately. Given the sheer size and scope of the insurance industry, what happens in this sector can shape the entire U.S. and even global economies.