1.5 Describe the Purpose of Cyber Risk Insurance 350-201 Practice Questions (Page 5)

Questions 21–25

1. 21application · medium

   A company's security team is preparing for a cyber insurance application. The insurer requires the company to document its incident response plan, backup procedures, and employee training program. The security team has a draft incident response plan but has never tested it. What should the team do before submitting the application?

   • AConduct a tabletop exercise to test the plan and update it based on the results.
   • BDelay the application until the plan is fully tested and all gaps are resolved.
   • CSubmit the application without mentioning the plan to avoid scrutiny.
   • DSubmit the application with the draft plan and note that it has not been tested.
   Reveal Solution Discussion Select an answer first
2. 22application · medium

   A mid-sized manufacturing company is evaluating cyber risk insurance. The company's primary concern is the financial impact of a ransomware attack that encrypts its design files and halts production. The CFO asks which policy feature would most directly address the cost of restoring systems and lost income during the outage. Which policy component should the risk manager prioritize?

   • AThird-party liability coverage for claims from business partners
   • BA high policy limit to cover multiple incidents in one year
   • CA low deductible to reduce out-of-pocket costs for any claim
   • DFirst-party coverage for business interruption and data restoration
   Reveal Solution Discussion Select an answer first
4. 23foundation · easy

   In a cyber insurance policy, what does the 'deductible' represent?

   • AThe annual premium paid to keep the policy active
   • BThe amount the insured must pay out of pocket before the insurer pays a claim
   • CThe maximum amount the insurer will pay for a covered loss
   • DThe list of events that are not covered by the policy
   Reveal Solution Discussion Select an answer first
5. 24application · medium

   After a near-miss phishing incident, a company's board decides to purchase cyber risk insurance. The CISO sees this as an opportunity to strengthen security. Which action best leverages the insurance process to improve the company's security posture?

   • AWait for a claim to occur before improving incident response procedures
   • BUse the insurer's underwriting questionnaire to identify and remediate security gaps
   • CPurchase the policy and keep the details confidential from the security team
   • DReduce the security budget because insurance now covers potential losses
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6. 25application · medium

   A logistics company is applying for cyber insurance. The insurer's application asks whether the company has segmented its network, implemented MFA for all remote access, and conducts regular backups. The company has implemented all three. What is the most likely effect on the insurance application?

   • AThe company's application will be automatically approved
   • BThe company may receive a lower premium or broader coverage due to a stronger security posture
   • CThe company will not need to purchase additional coverage
   • DThe company will be guaranteed coverage without exclusions
   Reveal Solution Discussion Select an answer first