Cyber insurance trends are defining the industry as cybersecurity rapidly becomes the fastest-growing sector.

At-Bay Inc. is a cyber insurance and security company focusing on smaller to midsized businesses, with a platform that has over 5,000 active customers consuming its security product. Meanwhile, 93% of small and medium-sized businesses lack modern security technology, creating a market failure, but as an insurance company, At-Bay can help reduce the cost of security and manage it on behalf of their clients, according to Rotem Iram (pictured), founder and chief executive officer of At-Bay.

“That combination allows us to unlock enterprise-grade quality products and services at the price points that SMBs can actually afford,” Iram said. “But it’s not just that. We know who to work with; they’re already our partners. They know us; they trust us. I think really incredible opportunity to be that kind of single point of this single platform for everything security in the mid-market.”

At-Bay’s Rotem Iram talks to theCUBE how cyber insurance can create a virtuous cycle by reducing risk.

Iram spoke with theCUBE Research’s Dave Vellante and Shelly Kramer at the RSA Conference, during an exclusive broadcast on theCUBE, SiliconANGLE Media’s livestreaming studio. They discussed how small businesses need to prioritize cybersecurity with affordable solutions and modern MDR services. (* Disclosure below.)

Navigating the latest cyber insurance trends

Making money in insurance requires taking on some level of risk, so the key is to balance the portfolio to ultimately make a profit. Ransomware claims have increased dramatically, with small and midsize businesses being increasingly targeted, and insurance companies play a crucial role in understanding the data and trends to mitigate the damage, Iram explained.

“We’re seeing more ransomware, dramatically more ransomware than we’ve seen in earlier years. In some ways, it’s the same story. It’s predictable,” Iram said. “What is new, and I think really interesting, is that the attackers have slightly changed their tactic … the attackers are now both encrypting your data and exfiltrating the data. They create double leverage for themselves … we’re seeing a larger blast radius from each and every ransomware now impacting tons and tons of third-party connected supply chain vendors in each attack.”

Small businesses make up a significant portion of the market. They are often targeted by opportunistic and automated attackers, with the average ransomware attack costing $280,000, which can be devastating for these businesses, according to Iram.

“It’s easy to forget about small businesses, but that’s 70% of GDP of this country. So, 70% of employees work for a small business. There’s a lot of value there and a lot of damage,” Iram said. “It’s a different profile of an attack. The attacker is more opportunistic, more automated and more predictable, but the damages are greater when compared to the size of the organization. So, SMBs struggle to recover from an attack. They don’t carry as much insurance.”

Insurance companies can use data to show how security controls drive down losses, and the role of insurance in setting standards for risk management can help small businesses understand the value of a technology solution. Cyber insurance purchasing in the U.S. has grown to $12 billion, and educating customers about bundling insurance with security is important, as they may not be able to afford better technologies, Iram explained.

“I think that our bundling with security makes sense to our customers, because for the larger part, they’ve heard about these better technologies. They just can’t really afford them,” Iram said. “They’re all buying an old antivirus. They realize that this is an old technology and they don’t necessarily want to be paying for it. But when we come in, especially when we can just lower the overall cost in a way that makes it very easy for them to buy, they don’t need a ton more.”

Here’s the complete video interview, part of SiliconANGLE’s and theCUBE Research’s coverage of the RSA Conference:

(* Disclosure: At-Bay Inc. sponsored this segment of theCUBE. Neither At-Bay nor other sponsors have editorial control over content on theCUBE or SiliconANGLE.)

Photo: SiliconANGLE