Safe Bet?

Last year, Citadel Security Software introduced the industry's first security software performance warranty. Backed by insurance giant American Inter-national Group, Citadel guarantees security content updates within 4 hours. If it fails to meet that commitment and a customer's computer network is attacked, the warranty will reimburse customers for related losses up to the amount of the software contract.

Cybersecurity expert Christopher Faulkner, founder and president of CI Host, a web-hosting and data center management company in Dallas, thinks software insurance is a bold and innovative idea, but says customers need to understand exactly what they're getting in terms of both the software and the coverage. "Don't just buy a package because it has insurance," he says. "Make sure you're getting a package that fits your specific needs and that you clearly understand the terms of the insurance, the liability the company is willing to accept, and what you'd have to do to activate an insurance payout." Also, don't depend exclusively on the product warranty to compensate you for losses. Instead, Faulkner says, be proactive by keeping your software current, backing up your data, and implementing other online security and data protection procedures.