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Embracing technology doesn’t mean we should unquestioningly adopt any new tech that comes our way. Instead, we should measure all new options with a discerning eye. We need to weigh their pros and cons, debunk their myths, and understand their realities—even for things as seemingly “simple” as the cloud.

The cloud is a network of servers that remotely store data and run programs. When you use the cloud for storage and applications, you reduce the power and space demands on your in-house system while also creating a method for integrated remote access on both business and personal devices.

Cloud computing has some obvious benefits. It’s more affordable than investing in your own network of servers. It creates accessibility of both data and programs while outside the office.  It makes it easier to both accommodate and afford growth in your organization. Finally, it can increase security of data, since most cloud computing vendors invest in continually strengthening that aspect of their security.

Avoiding Cloud Worship

But that doesn’t mean it’s all upside. While we generally expect cloud servers to back up our data, there are no guarantees that they will complete full backups often enough for our own organization’s needs. There’s also the possibility that the cloud computing company you choose will go out of business or transfer ownership to an organization that reduces or limits its services.

And while cloud storage is often more secure than in-house systems, there are still security weaknesses. For example, security problems can arise when the cloud network employees improperly or carelessly handle passwords.

When storing customers’ personal information in the cloud you must know the physical location where data will be stored. Cloud providers often have many data centers spread across the globe to ensure high redundancy and protect against data loss in case one data center becomes compromised.

But insurance regulation might restrict the geographical location where personal information can be stored. In some cases, data could be stored initially in a location that is acceptable for the insurer but could be moved, in emergency situations, in other locations that are not permitted by regulation.

Most cloud solutions are based on virtualization technology. This brings many advantages, providing efficiency and capabilities that cannot be achieved using physical servers only. But, from a security perspective, it has its drawbacks too: in a multi-tenant environment, the hypervisor (the machine hosting other virtual servers) could be compromised by one guest, leaving other guests exposed.

Additionally, a misconfiguration on the host can have greater consequences compared to an in-house system or private cloud. Even when all guests are properly configured, it is still possible to compromise the hypervisor. One of the most recent examples is based on so the called “Rowhammer” attack, which allows one machine to effectively steal the cryptographic keys of another machine hosted in the same cloud environment.

After sorting through the pros and cons and deciding how to implement cloud computing with your business, the next step is to understand myths and realities.

Myths and Realities

One of the popular myths is that there could be excessive downtime, making it impossible to access your documents or applications during crucial periods. This one strikes fear in everyone’s heart. The cloud is down and you can’t access your data or programs! But because of the network of systems supporting the cloud, the reality is that this won’t happen.  When one system goes down, service will be redirected to others that are working.

Another dangerous myth is that all clouds are created equal. In reality, there are many options for insurers to explore—from private servers to public, and even hybrid options, where the software is in the cloud, but the data remains at the insurer.

Ultimately, each insurer needs to determine how the cloud can benefit its individual business operations, and then decide which type of cloud service best fits that need. This can only be done effectively when you examine both pros and cons and then sift through the myths to get down to reality.  Then, you can select a cloud solution that minimizes the risk and maximizes the benefits.