Data Safety Warranties – Are All Cybersecurity Warranties Created Equal?
It’s no surprise that more distributors are offering buyers the latest warranty that includes cybersecurity. Data loss is estimated to cost businesses $265 billion by 2031. These guarantees are designed to reduce the financial risks of cyberattacks and eliminate the responsibility of the vendor, usually to fill in the gaps where insurance may not be able to cover a loss.
However it is true that not all warranties for cybersecurity are the same. Certain warranties come with strict conditions that could result in your company paying a significant amount for information returning, particularly when you’re not familiar with the details. For instance, many warranties on technology limit payments according to the amount the vendor spent on their solution. This isn’t very helpful, as the value of a particular record in Cohesity FortKnox may be more than the amount of license fees paid to a technology vendor.
This is a red flag as the cost of losing productivity from employees could be more expensive than the total amount of time that the software was in use during the period. This is a major alarm because the price of lost productivity can be a lot more expensive than the total amount of time the software was in use during that period. By incorporating representations and warranties that focus on the legal processing of data up to the smallest division of a company can reduce costly risk during M&A deals.