4 opportunities MSPs can leverage from cyber insurance
The rapid escalation of cyberattacks around the world has increased the number of prerequisites to qualify for a cyber insurance policy. If a business faces a cyberattack involving a data breach, it may find it hard to recover without additional support or resources. And this is just one example.
In 2022, the cyber insurance market was valued at $11,904.6 million, and is expected to grow at a rate of 19.1% from 2022 to 2030, to reach $48,328.4 million, according to data from a recent study by P&S Intelligence. This growth is attributed to the rising number of threats, coupled with increasing demands for cybersecurity legislation and the implementation of risk mitigation and insurance strategies across all sectors.
The changing cyber insurance landscape can prove particularly challenging for small and midsize businesses to navigate. Especially given the stringent requirements in terms of the platforms and processes needed to qualify for coverage. However, these businesses can benefit from having a trusted partner who assists them in the process of contracting and complying with the demands now required by cyber insurance, while MSPs can strengthen their relationship with clients and grow their business.
Opportunities cyber insurance offers MSPs
Partner with an insurer:
To be eligible for insurance, organizations obviously need to demonstrate an adequate level of cybersecurity maturity. However, insurers do not always have cybersecurity professionals on their staff, which means they do not know how to conduct the necessary security assessments to understand the protection organizations have in place. In such instances, they partner with MSPs to support them in this task. Likewise, it is common for them to rely on third parties to mitigate, investigate and remediate cybersecurity threats. This is a business opportunity for managed service providers as they could become the ideal partner for insurance companies.
Offer new solutions to clients:
To qualify for a cyber insurance policy, insurers require organizations to demonstrate the level of cybersecurity they manage and the security controls they use. They require solutions such as MFA, endpoint protection, patch management, and email filtering to be implemented. This opens the door for MSPs to have additional conversations with clients and accelerate projects to become compliant.
"We had a client with 1,000 users and their cyber insurance in 2021 cost $21,000. In May 2022, the client received two quotes. One was for $70,000 and the other was for $100,000. We improved the company’s endpoint by adding EDR, and it ended up with a quote of $27,000. The client was able to improve the company’s security posture substantially. They came out ahead by enhancing the company’s cybersecurity, but the cybersecurity problem that companies face is no small thing. We've helped more companies fill out more cyber insurance forms than ever before," says Jodi Gawf, owner of WatchGuard partner Saje Network Systems.
Act as consultants:
Businesses do not always have a thorough understanding of the requirements insurers demand or simply do not know what to do or which provider to choose. MSPs can act as consultants in this area and provide clarity to organizations looking for a good policy. In addition, they can provide security training, as user behavior is still a critical part of cybersecurity. Moreover, as well as enhancing their offering, they can build trust with clients.
Calvin Engen, CTO of WatchGuard partner F12.net, commented, "We are seeing that it is becoming increasingly difficult for small and medium-sized businesses to obtain cyber insurance. Customers are asking why and are looking for trusted advisors to help them assess what they can do. They need to understand that they need more controls, more solutions to be able to obtain that level of cyber insurance. The truth is they are no longer able to obtain the level of insurance coverage they could before. We have the advantage that we’ve been talking about these types of solutions with them already, so we are top of mind when they need these services. We're seeing a big increase in cybersecurity services to better protect our customers."
Get better prices:
In addition to serving as consultants, MSPs that enjoy good relationships with their suppliers can get better prices for their clients by offering different cybersecurity packages that achieve the level of security needed to qualify for a good cyber insurance policy.
The importance of acting as a cybersecurity consultant
The cost of a cyber insurance policy is based on analysis of current and projected future cyberthreats. As the client's technology advisor, it is important to support them in their decision-making and help them follow the rules.
This is a big business opportunity for MSPs who can increase their cybersecurity sales while building a trusted relationship with clients.
Whether it's to advise your clients, or to take out cyber insurance for your MSP business, WatchGuard has created the Cyber Insurance Buyers Guide that explains in detail everything there is to know about obtaining the best cyber insurance for businesses.
For more information on cyber insurance, please see our blog articles below: