The use of the Internet throughout the past decade has drastically increased on a global level. The internet, as well as networked technologies, has significantly impacted the way businesses, governments, global enterprises and regular individuals operate on a daily basis. While there are a number of benefits that go along with using the internet, the threats are equally and in some cases more destructive. Recently, major and popular news companies have been plastered with headlines relating to a number of topics involving the rise in data breach incidents and the claims as a result of the breaches. Therefore, cyber risk is a problem we all have to be concerned about based on the heavy use of technology in the twenty-first century. .
According to the Institute of Risk Management, cyber risk refers to "any risk of financial loss, disruption or damage to the reputation of an organization from some sort of failure of its information technology systems." The increase of cyber risks can be seen as directly proportional to the rise in the use of the internet and networked technologies. This is because the internet and network technology has provided businesses, governments and individuals with the ability to do things such as readily store and share data across connected networks and operate the departments of sales and marketing, data manipulation and global interaction more efficiently. This has resulted in the need for cyber insurance. The need has been so extensive that cyber insurance is currently one of the fastest growing segments in the insurance industry. This is because everyone, especially businesses and enterprises, desire to be indemnified through insurance products in the event of a loss. It is a common misconception that large retail companies or organizations are the targets for valuable information and hence should be the only groups concerned with taking the necessary precautions regarding cyber risks.
