Cybersecurity Insurance to Mitigate Cyber-Risks and SEC Disclosure Obligations

The Securities and Exchange Commission's guidance outlining cybersecurity disclosure obligations encourages registrants to disclose what form of insurance coverage they have. Cybersecurity insurance may lessen a company's financial risks and limit its disclosure obligations by encouraging the company to implement best practices and reduce the harm of potential cyberattacks, author Edward R. McNicholas of Sidley Austin writes.
Yet only a fraction of companies have cybersecurity insurance.