Data Safety Warranties – Are All Cybersecurity Warranties Created Equal?

It’s not a surprise that more distributors offer buyers the latest warranties which is the cybersecurity assurance. Data loss is expected to cost businesses $265 billion by 2031. These warranties are designed to minimize the economic risk of cyberattacks, and shift liability to the vendor. They usually fill the gaps left by insurance.

But, just like other type of warranty, not all cybersecurity warranties are all created equal. Certain warranties have strict stipulations that could keep your business paying a high cost for information being returned, especially in the event that you aren’t aware of the specifics. The majority of warranties on technology, for example, limit payment based upon how much the provider invested in their product. This is not a good thing since the value of a single record in your Cohesity FortKnox might be much more than the total amount spent on license costs with a specific technology vendor.

For example, if you’re a Rubrik customer and are not able to retrieve your data because of an attack with ransomware their warranty will pay for what they call “Recovery Incident Expenses.” However they require receipts for the number of hours employees devote to the recovery process. This is a huge warning because the cost https://www.toptechno24.com of lost productivity by employees could be more expensive than the total amount of time the software was used during the period. Therefore, incorporating warranties and representations that focus on the legal processing of data up to the most remote part of a business will help minimize the risk of financial loss during M&A transactions.