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The Truth About Data Safety Warranties in Technology M&A

By 14 avril 2024avril 18th, 2024No Comments

A warranty is a commitment by a seller or manufacturer that the product purchased is free from defects or flaws for a set period of time. In the context of technology M&A warranties are an effective tool to manage risks related to cybersecurity and availability of data.

Security guarantees for data are becoming more popular among distributors. With ransomware expected to cost businesses $265 billion in 2031 and an increase to attack every two seconds, it is no surprise that they offer this new guarantee to their customers. These guarantees reduce the economic dangers of cyberattacks and breaches by shifting legal liability to the vendor and they’re normally offered as a complement to cybersecurity insurance, assisting in filling the gaps when insurance coverage might not be sufficient.

Security guarantees differ widely in their details, but typically include the loss of revenue for a business as well as additional costs incurred and reputational damage caused by an attack. They may also contain policies that is designed to cover legal responsibility that covers the cost of allowing individuals impacted by an attack to be informed as well as any fines or charges received from potential lawsuits.

While the idea behind a data security guarantee is a good one, many of them are flawed. Rubrik offers the « Recovery Incident warranty » that pays for « Recovery incident expenses. » However, this does not mean your employees will be paid for the time spent on recovering. Rubrik will only pay when they have receipts to prove the expenses. This is a small red signal.

https://www.toptechno24.com/what-should-you-know-about-amazons-digital-currency

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