350-201 Question 23
Single answerA medium-sized company recently suffered a ransomware attack that disrupted their operations and resulted in financial and reputational losses. As part of their cybersecurity improvements, the company is considering cyber risk insurance. What is the primary purpose of cyber risk insurance in this scenario?
- A
To provide financial coverage for losses incurred during a cyberattack
- B
To prevent ransomware attacks by deploying proactive security tools
- C
To ensure compliance with industry-specific cybersecurity regulations
- D
To provide technical support for incident response and recovery
Show answer and explanation
Correct answer: A
Explanation
The primary purpose of cyber risk insurance is to provide financial coverage for losses resulting from cyberattacks, such as litigation costs, data recovery expenses, and business interruption losses. It does not directly prevent attacks or ensure compliance with regulations but instead helps organizations recover financially from the aftermath of a cybersecurity incident.
- A. Correct.
Cyber risk insurance is designed to provide financial compensation for losses incurred during or as a result of a cyberattack, such as ransomware incidents.
- B. Incorrect.
Cyber risk insurance does not directly prevent attacks. Preventing ransomware attacks requires proactive security measures like firewalls, endpoint protection, and employee training.
- C. Incorrect.
While cyber risk insurance can complement compliance efforts, its primary purpose is not to ensure regulatory compliance but to mitigate financial losses.
- D. Incorrect.
Technical support for incident response and recovery is typically offered by cybersecurity vendors or in-house teams, not the primary purpose of cyber risk insurance.