With data loss impacting businesses every two seconds and expected to cost businesses $265 billion by 2031 It’s no wonder that more distributors are offering customers a brand new type of guarantee which is called the cybersecurity warranty. These warranties are designed to minimize the financial risks of cyberattacks and are often a complement to insurance. They fill in the gaps that insurance doesn’t cover.
These warranties are not all the same. Some have strict stipulations that can result in companies having to pay a big price tag for information retrieval in the event of a cyberattack. These may include:
Incorporating this type warranty into an M&A deal can be a great way to ensure the buyer is adequately protected against security risks that could arise, and that the vendor takes steps to prevent attacks like this from occurring in the future. These new warranties, in addition to the usual representations and warranty clauses in an asset purchase agreement or stock purchase contract, can be negotiated to ensure that they include privacy, data protection and other issues https://www.toptechno24.com/how-to-connect-your-nintendo-switch-to-the-tv specific to the transaction.
A typical warranty may include the cost of fixing and replacing hardware and software, as well as the cost of forensics and IT work to retrieve data, and the costs of compensating individuals who are affected by a breach. Some warranties also cover legal expenses resulting from possible lawsuits. A more comprehensive version might also pay for lost revenue and the cost of programming the software and also the cost to restore reputational damage resulting from a security incident.