Five Reasons Why Businesses Should Purchase Cyber Insurance
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1. Employees May Click On Something They Should Not
A large percentage of cyber claims result from human error.
Theft of funds, ransomware, extortion, and data breaches generally start with human error: clicking on a link which allows access to your system or collects sensitive information. Humans are the weakest link in cybersecurity.
- Cyber insurance can provide access to risk management tools such as phishing training. It can also cover financial loss if an employee makes a mistake.
2. Cyber Security Support For Free
Most small to medium businesses do not have in house IT security team. This can leave you exposed and vulnerable to cyberattacks.
- With cyber insurance, you gain access to the support you need to prevent and respond to cyber incidents. Most cyber policies come with risk management support and training for employees, reducing the risk of successful phishing attacks. They also monitor the dark web for signs your data may have been compromised.
- In the event of a claim, many cyber policies will provide you with access to IT experts, forensic experts, PR firms, lawyers to assist and protect your business reputation.
3. 60% + Of Cyberattacks Are Focused On Small To Medium Businesses
When you look to the media, it is very rare to see small businesses making headlines for being attacked by cybercriminals. However, cyberattacks in the UK grew by 140% in 2018 and have shown no signs of slowing down since. According to the 2018 Verizon Data Breach Investigations Report, 58% of cyberattack victims were small businesses.
You don’t often hear about local businesses that have mistakenly transferred substantial funds from a social engineering scam: the accountants, solicitors, or doctors’ offices that are unable to access their computer systems because of a malware attack.
Small to medium-sized businesses are often seen as easy targets. They often lack resource and capital to invest in IT security or employee training, making them ripe for attack.
- Cyber insurance policies are designed to protect businesses of all sizes, so you can gain knowledge to protect your business and peace-of-mind that you’re covered should a successful attack occur.
4. “We Don’t Collect Or Hold Sensitive Data” – Think Again!
The most common sources of cyber claims are not related to data or privacy breaches. Fund transfer fraud is often carried out by emails to divert the transfer of funds from a legitimate account, and ransomware can freeze and damage business-critical IT.
- These incidents would not be considered a data breach but would lead to major financial loss and are insured under a cyber policy.
- Over 50% of cyber claims come from events unrelated to breaches of privacy. As the vast majority of businesses use technology to operate, you will have a range of cyber exposures which cyber insurance would address.
5. Traditional Insurance Policies Fall Short
Traditional insurance policies fall far short of providing the level of cyber cover that is suitable for businesses. These policies were designed to insure buildings, machinery, and plant liabilities – not your digital and cyber exposures. A standard crime policy generally excludes social engineering losses; professional indemnity insurance doesn’t generally cover first-party costs associated with a cyber incident.
- A strong cyber policy will cover the voids left by traditional insurance policies, they come with access to risk management tools, training and specialist support in the event of a loss.
