Small-business insurance can help companies maximize the cost-saving potential of cloud computing.
Technology has significantly improved many aspects of the business landscape in recent years. Previously, companies often spent large sums of money on expensive hardware and software programs that stored company data and allowed employees to communicate and complete their daily work tasks.
Now, more businesses are finding an opportunity to save money on overhead costs by switching from a hardware-based information technology system to new cloud-based software.
Many industries have discovered the potential for substantial cost savings. Even the U.S. government has encouraged its agencies to evaluate cloud-based options for their operations. According to Federal Times, recent internal assessments at government offices revealed $20 billion in potential savings from switching to cloud computing technologies.
Transferring company data to the cloud presents especially valuable savings opportunities for small businesses. According to The Guardian, cloud-based systems reduce the need for companies to pay for expensive hardware and associated software. With the cloud, they can essentially have it all in one – and at a much lower cost.
However, businesses still need to be careful when incorporating cloud technology into their operations. There are a variety of security risks associated with storing data online.
Companies should take a close look at the kind of information they will need to store before they make the switch. According to Fox Small Business, some laws prohibit the transfer of certain data to the cloud. For example, medical clinics may not be able to store private patient health records. Financial businesses also face restrictions of their own.
Insurance and cost savings
Purchasing a small-business insurance plan is another effective safeguard against the risks associated with cloud computing. For example, property insurance can help a young and growing business cover costly damages from a sudden loss of data in the cloud. Cloud-based systems used by companies of any size are a major target of hackers. Furthermore, small businesses are much less likely to recover from data breaches compared to larger organizations.
Cloud services are cost effective, but only if they can properly protect data. A breach of valuable information can end up being much more expensive than the alternative of not using cloud computing at all. However, a strong password system, as well as an individualized small-business insurance plan, can make all the difference in keeping a cost-effective cloud computing plan from turning into a security nightmare.
