Hello and welcome back to our website. In this article, I will be explaining what cyber insurance is and why small and medium-sized businesses need to worry about cyber attacks.
You might think it is just the “big boys” that need to worry about a cyber attack. I’m sure you have heard the stories of Yahoo, Linkedin, and the huge IT companies in Europe and America, they are the stories that make the headlines. What is less well known is that SMEs are equally at risk with thousands of companies being attacked and hacked regularly. A report by Hiscox insurance firm shows that Cyber attacks in 2020 have increased by half of the figures for 2019.
What is Cyber insurance?
Small businesses are increasingly at risk, the report shows that there has been a 14% increase in cyber-attack incidents being reported, the average mean cost of this for a small business is around $11,000. Anyone who uses a computer or the internet to hold data about customers, suppliers, or employees, carries out online transactions, or just uses social media must consider their online security.
Cyber insurance protects your business from all the threats we face in the digital age. Cyber-attacks can put your business at risk of data breaches, the loss of IT systems and networks, and the loss and theft of sensitive information. Malicious cyber-attacks on your website can cause all sorts of trouble and even provide criminals with access to your customer database; you then could be held responsible for a data breach under data protection legislation.
If you run a business the chances are that to a greater or lesser extent you will be relying on an IT system to some degree. Therefore, you will be at risk of business interruption, damage management and repair, loss of income, and possibly even reputation damage if your IT systems fail.
What is Cyber liability insurance?
Cyber liability insurance or data protection insurance is required to protect your business in the event of a data breach within your own systems and is responsible for the spreading of a computer virus to other people or businesses.
Some existing insurance policies such as commercial property, Business Interruption, or PI insurance provide some element of cyber insurance cover. However, more and more businesses are investing in specialist cyber insurance.
Particularly, if their business relies: heavily on holding sensitive information, Conducts a large part of their business online, Regularly takes card payments
What does Cyber insurance protect you from?
Having cyber liability insurance can help minimize business interruption during a cyber incident and the fallout from an attack. It can also potentially cover the financial cost of repairing the damage and the recovery. It is, however, important that as the business owner you are aware of what cyber insurance does cover you for and what it doesn’t. In a nutshell as the business owner, you are responsible for your cyber security.
What Cyber insurance does cover?
cyber insurance does not prevent an attack however it helps clear up the mess after an attack. There are several ways you can protect your data in the first place from educating yourself and your staff on cyber security to encrypting and backing up your files.
Examples of Cyber-attacks
Back in May 2019 Canva, the Australian graphic design tool website suffered an attack where 137 million user accounts were exposed. The hackers were able to access email addresses, usernames, names, cities of residence, and passwords. They were also able to view partial credit card and payment data.
The same can happen to the data you hold on your clients and customers whether you’re a small garage or a local hairdresser. From gift shops to call centers, without proper security and insurance backup you and your business could be exposed.
Cyber insurance will cover the losses relating to the damage or loss of information. Most policies will include help with the management of the incident itself which can be incredibly helpful when faced with damage to your reputation and regulatory enforcement.
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