Cyber Insurance - understanding the benefits for small businesses
It’s not just large corporations which are at risk from cyber space; SME’s are just as vulnerable to attack. Small businesses form the back bone of UKPLC and it is important that you understand the threats posed and have an insight into the benefits of insuring against online attacks.
Cyber crime can be intentional or accidental and instigated from both internal and external sources. The potential for smaller as well as large businesses to become victims of the phenomena is greater than ever and the latest Government research, a report entitled ‘UK Cyber Security: The Role of Insurance in Managing and Mitigating the Risk’, confirms that “Cyber attacks against UK companies present a daily threat to normal UK business operations and are increasing in severity”.
A representative of one small company that was targeted by a Trojan virus explained “We’ve always been really strong on our IT integrity, ensuring that we have all the latest practices in place and the very latest Firewalls, but they still managed to attack us”.
“This cyber attack has cost my business money – a new computer, the rebuilding of the old computer, a new firewall and a member of staff not being able to work for half a day. But what if we had lost customer data, how would we have coped with the required remedial measures? I truly believe that all businesses need to have cyber cover in place and that’s exactly what I’ve done”.
How can cyber insurance provide a solution?
Whilst the subject of cyber crime can appear daunting, insurance is available to safeguard businesses against the commercial losses than can result. In reality however, executives frequently overestimate the cover that they have in place.
The ‘2014 Information Security Breaches Survey’ undertaken by PWC on behalf of the Department for Business, Innovation and Skills confirms “surveys show that 52% of CEOs believe that they have cover, whereas in fact less that 10% do”.
Although commercial and business insurance offers some protection to SMEs, specialist cyber insurance policies are available to specifically cover against a host of risks including:
- Business downtime caused by IT system outages.
- Blackmailers asking for payment to prevent the release of confidential information.
- Damage, loss or theft of IT hardware and software.
- Damage to corporate reputation that may arise from loss of intellectual property and clients.
- Legal and civil damage costs of defending privacy breaches or defamation that appears in online and offline publications.
- The loss of customer data and any resulting compensation settlements.
Please contact me to discuss cyber insurance or request further information on how it can help
safeguard your organisation.