This week Zurich Insurance announced that it has released cloud computing insurance plans that will help to protect businesses from financial loss due to cloud outages and mishaps. It makes complete sense when you think about it, you wouldn't drive a car without car insurance and you wouldn't purchase a house without some kind of home owners insurance. If a company puts all of its information and applications in the cloud it is relying on the cloud to be up and running, if this isn't the case then the company essentially has to shut down. In some cases a service level agreement will cover the cost of what a company would have spent with their cloud provider. However, this isn't always the case and most SLAs don’t cover much else, such as money your customers would have spent during that downtime. This is where these new cloud computing insurance policies come in.
Though it does take a lot to put a cloud provider in the dark it is definitely possible, during hurricane Sandy several cloud providers were out of commission due to wide spread power outages and floods, which rendered backup generators useless. When a cloud provider is forced to shut down it also forces any business that uses their services to shut down as well. This business interruption is exactly what these cloud computing insurance policies are protecting against, they will fully cover a business from any income lost due to a cloud providers downtime.
There are several other companies who are providing insurance products directed at cloud users. Cloudinsure.com was created for this exact reason and designs all of their insurance plans around the Cloud environment.
Now, one thing you can do initially to avoid this situation altogether is making sure to select a cloud provider that has redundant failovers in multiple datacenters around the country. This protects against scenarios such as the ones seen during Hurricane Sandy. However, as the cloud continues to grow and further investment goes into it, it may not hurt to look into a quote for cloud insurance to make sure you are covered from head to toe.
Written By: Sam Watkinson
Marketing Associate TOSS C3