Cyber insurance is a type of insurance that covers the financial losses and liabilities that result from cyberattacks, such as data breaches, ransomware, denial-of-service, phishing, or malware. Cyber insurance can help a company recover from the costs of restoring data, repairing systems, paying ransoms, compensating customers, or facing legal actions. Cyber insurance is one of the possible strategies that a company can use to address the items listed on the risk register. A riskregister is a document that records the identified risks, their probability, impact, and mitigation strategies for a project or an organization. The four common risk mitigation strategies are:
Accept: The company acknowledges the risk and decides to accept the consequences without taking any action to reduce or eliminate the risk. This strategy is usually chosen when the risk is low or the cost of mitigation is too high.
Transfer: The company transfers the risk to a third party, such as an insurance company, a vendor, or a partner. This strategy is usually chosen when the risk is high or the company lacks the resources or expertise to handle the risk.
Mitigate: The company implements controls or measures to reduce the likelihood or impact of the risk. This strategy is usually chosen when the risk is moderate or the cost of mitigation is reasonable.
Avoid: The company eliminates the risk by changing the scope, plan, or design of the project or the organization. This strategy is usually chosen when the risk is unacceptable or the cost of mitigation is too high.
By purchasing cyber insurance, the company is transferring the risk to the insurance company, which will cover the financial losses and liabilities in case of a cyberattack. Therefore, the correct answer is B. Transfer. References = CompTIA Security+ Study Guide (SY0-701), Chapter 8: Governance, Risk, and Compliance, page 377. Professor Messer’s CompTIA SY0-701 Security+ Training Course, Section 8.1: Risk Management, video: Risk Mitigation Strategies (5:37).
