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Five points to consider before buying cloud insurance

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Deepa
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BANGALORE, INDIA: If you are considering to buy a cloud insurance policy,  these five points are for you.

1. Risk coverage: Does it cover first party risks

How would you feel if you lose thousands of dollars worth business due to a mistake that was not yours? Lost? Now imagine, you lose money as well as business, due to someone else' mistake and that someone refuses to pay compensation terming it an accident for which he/she is not liable for.

Now, you will feel cheated? In order to avoid such situations, verify that your cloud insurance policy covers all sort of risks, particularly first-party and third party risks.

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In first-party risk coverage, you should be covered for losses incurred due to factors such as, software or network failure, virus attack, physical damage to resources, corrupt or loss of data, website being inaccessibly, data breach etc.

That takes us to the second factor, which is

2. Does your policy cover third-party risks

Agreed, it is a sort of a gamble that you host all that you have on someone's else property, thinking that someone else has done everything to make his/her property accident proof. However, 'God forbid' or 'Man forbid', what if something goes wrong, despite '99.99 percentage of uptime assurance and you end up suffering loss.

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So, before signing a policy check if it makes your cloud service provider liable for the loss you incur owing to its service delivery platform issues, which could have been caused during natural calamities or due to human error.

3. Will it provide coverage for data loss outside country

Today, employees access corporate data on the go, no matter whether they are at home, office or stationed outside the country, since all they have to do is connect their device to a cloud.

Similarly, data on a cloud can reside anywhere, literally. Though there are provisions to specify region in which you want your data to reside, we need to be aware that there are still not as many cloud data centres as there are countries in the world. So, there are more chances that your data might be residing in the same continent but not necessarily in your country.

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So, to be on the safer side, verify whether or not such incidents are covered and if not, are there any provision to insure data even if it does not fall in the jurisdiction of your country?

4. Will it pay for data restoration

Everytime a cloud outage strikes, you end up spending some amount in restoring the lost data. So inquire whether a cloud service provider is liable to pay for this restoration activity.

Last, but not the least:

5. Do not take for granted 'Terms and Conditions' doc

It does require a lot of time and expert advice, however, trust us, it is worth every minute and every single penny spent on it.

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Thoroughly analyse the terms and conditions of a cloud service provider. Else, you will end up feeling sorry when you learn that this service provider is not liable for any business loss you incurred due to cloud outage, as per a clause mentioned in the contract.

Lay to rest such dilemmas by reading all the lines, and if possible even between the lines, mentioned in the contract before signing one. Settle for what is best for you.

Happy cloud'ing'.

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