With data loss affecting a company every second and estimated to price businesses $265 billion by 2031, it’s not surprising that distributors are now providing buyers with the latest type of warranty: the cybersecurity guarantee. These guarantees are designed to minimize the economic risks associated with cyberattacks and remove any liability that is transferred to the vendor, often to fill in the gaps where insurance could not cover the cost of a damaged.

However, just like any other warranty there are different cybersecurity warranties. Not all are created equal. Certain warranties come with strict terms that could cost your company many dollars if you don’t study the fine print. Most warranties for technology, like have a limit on the amount of money you pay based on how much the provider invested in their solution. This is not very helpful as the value of one particular record in Cohesity FortKnox may be more than the licensing costs paid to a technology company.

This is a major warning because the cost of losing productivity from employees could be higher than the total amount of time the software was in use during the period. This is a red flag because the cost of lost productivity of employees could be much higher than the time they spent using the software during the period. In this way, including representations and warranties that focus on the lawful processing of data up to the most remote division of a Protected document exchange company can help reduce the risk of costly losses when it comes to M&A transactions.