350-201 Question 24
Single answerA medium-sized e-commerce company has recently implemented Cisco security technologies to enhance its cybersecurity posture. Despite these measures, the company’s CEO is concerned about the potential financial impact of a ransomware attack or a data breach. Which of the following best describes how cyber risk insurance can benefit the company in this scenario?
- A
It helps cover financial losses due to cyberattacks, such as ransomware payments or business interruption costs.
- B
It prevents cyberattacks by enhancing network security protections and threat detection mechanisms.
- C
It provides legal and regulatory guidance to help the company comply with data protection laws.
- D
It ensures that sensitive customer data is never compromised during a cyberattack.
Show answer and explanation
Correct answer: A
Explanation
Cyber risk insurance provides financial protection to businesses by covering costs associated with cyberattacks, such as ransomware payments, data recovery, and business interruptions. While it cannot prevent attacks or guarantee data security, it serves as a critical safety net to mitigate the financial risks of a cybersecurity incident.
- A. Correct.
This is the correct answer. Cyber risk insurance is designed to mitigate the financial impact of cyber incidents, helping businesses recover costs associated with ransomware, business interruptions, or data breaches.
- B. Incorrect.
This is incorrect. Cyber risk insurance does not actively prevent cyberattacks; it addresses the aftermath by offering financial compensation for losses.
- C. Incorrect.
This is incorrect. While some insurance providers may offer limited legal support, the primary purpose of cyber risk insurance is financial protection, not legal compliance.
- D. Incorrect.
This is incorrect. Cyber risk insurance cannot ensure that sensitive data is never compromised. It only helps the organization recover from the financial and operational effects of a data breach or attack.