Data loss is estimated to cost businesses $265 Billion by 2031. It’s not surprising that more distributors offer customers a new kind of warranty called the cybersecurity warranty. These warranties are designed to lower 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. Certain warranties have strict conditions that could cost companies a amount of money to retrieve information in the event of a cyber attack occurs. These stipulations can include:
Incorporating this type warranty into a technology M&A deal can be an excellent way to make sure that the buyer is adequately protected against security risks that could arise, and that the vendor will take steps to stop such attacks from happening in the near future. In addition to the usual warranties and representations in an asset or stock purchase agreement, these new warranties can be negotiated to address privacy security, data security, and other relevant issues that are specific to the transaction being considered.
A typical warranty will https://toptechno24.com cover the cost of repairing and replace equipment, as well as the cost of IT labor, forensics, and the compensation of those affected by a breach. They also cover the costs of legal costs arising from lawsuits. A more comprehensive version may also be able to cover the loss of revenue as well as the cost of reprogramming the software and the cost to restore reputational damage caused by an incident involving security.