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The Real Problem with Outsourcing Cyber Liability

· Cybersecurity,Cyber Insurance

‘It takes a village to raise a child’

The same is true of cyber security. A shared responsibility, every last employee of the company should work towards reducing the risk of a breach.

Outsourcing Cyber Liability is an after-care, not a preventive measure. To truly understand and reduce the chances of a data breach from happening, transparency is crucial.

But this is impossible to achieve with third-parties since you cannot virtually control the data they are privy to.

So, should you stop outsourcing cyber liability completely?

No. Outsourcing does have an upside in that it can allow you to have a level of expertise that is not available in-house.

On the flipside, an off-the-shelf cyber liability plan is what you get when you outsource cyber liability because their business model depends on assisting as many companies as possible.

Since the agency is not dedicatedly working to protect your company, relying on them wholly would be erroneous.

How to fix this: The right level of security

Since outsourcing is unavoidable, here a few things you can do to minimize the risks:

  1. Procurement: When hiring an agency, make sure to assess the industry standard and vet the agency thoroughly. It would be wise to request the agency if they are proven to have a proper cyber security posture - a regular cyber risk assessment report will be a good way of proof.
  2. Tailored solution: Work with the agency to establish the potential risks and understand your options in the event of a data breach.
  3. Don’t relinquish control: Access to the data should be limited to avoid complete dependency.
  4. Periodic Assessments: Use risk questionnaires to ensure the agency conforms to your rapidly changing organization.

Many companies unwittingly believe that outsourcing cyber liability gives them free rein to follow the bare minimum regulations. This is exactly the opposite of what an enterprise should be practicing.

The focus with cybersecurity on an enterprise level should always be on developing a robust, agile and customized security plan wherein everyone in the company plays a significant role to reduce the risk of a data breach.

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