Cyber Crime Insurance: Do You Need It?
Recent years have seen a tremendous growth in technology. We are now living in the information age, which means data is used, stored, and accessed like never before. With these advancements, society has seen countless benefits, but it has become increasingly clear that this technology also makes data vulnerable to a number of risks. High-tech cyber attacks have become more prevalent and widely publicised in the last few years, and new Privacy legislation introduced in 2014 highlighted the growing concern for the protection and confidentiality of intellectual property and personal and consumer data.
With businesses and organisations relying more and more heavily on the digital world, you may wonder how safe your business is from possible cyber attacks.
What Cyber Threats are Out There?
Cyber attacks can affect all types of business, indiscriminate of industry or size. Symantec’s 2014 Internet Security Threat Report provided some alarming statistics, including a 62% increase in data breaches within one year, with eight of those breaches exposing more than 10 million private records. The report also stated that a growing number of attacks are targeting small and medium-sized businesses. It isn’t only the major industry players who have to worry. Furthermore, Symantec’s report uncovered an increase in website vulnerabilities for legitimate websites, and found that more than 174,000 attacks occurred within 30 days of vulnerabilities being discovered. Of the legitimate websites on the Internet (many of which belong to businesses), 1 in 8 has a critical vulnerability unknown to the vendor which leaves it prime for attack.
Cyber attacks can come in all varieties: viruses which significantly halt or interrupt business, stolen business financial information, theft of consumer credit card numbers, other private consumer data, loss of company records, infringement on copyright or intellectual property, e-vandalism, a confidential email breach and more. Such massive–and often costly–attacks can originate from anywhere across the globe. They may be the work of insiders or business partners, or could be from a single unknown hacker or organised hacker ring with little connection to your business. With the variety of threats and the potential for vulnerability, you need a sense of protection.
How Can Cyber Crime Insurance Help?
The first step in protecting your company’s valuable data is to minimise the risk. This may involve tightening your security programs and procedures considerably, investing in off-site data storage, or expanding your IT team. Yet even the most secure of systems is still susceptible to cyber threats. In case the worst happens to your business, cyber crime insurance coverage offers financial and legal protection, and invaluable peace of mind.
Cyber attacks can incur incredible costs from crisis management, disaster recovery, lawsuits regarding customer damages, intellectual property lawsuits, legal investigation, and many other aspects generated by an attack. These costs can result in significant out-of-pocket and reputational costs that can be devastating to your business. Cyber crime policies can help you handle these potential outcomes, offering thorough protection for a range of cyber risks. Such policies are vastly different than traditional insurance, which doesn’t cover technological attacks. Most policies will cover:
● Liability to third parties for failing to keep data secure (claims for compensation)
● Investigations, legal costs, fines, and penalties incurred due to a breach of the Privacy Act.
● Business costs related to cyber attack recovery, including credit monitoring, public relations costs, payments for cyber extortion, data recovery, and more.
● Coverage for business interruption, recouping profits for the business that were lost as a result of an inability to continue doing business following a cyber attack.
Cyber crime insurance can protect you in the face of unpredictable and financially-damaging cyber breaches, aiding your business in handling the expenses and fallout from such an event, and helping you get back on your feet.
Macey Insurance Brokers works with several different quality providers of cyber crime insurance. Together, we can assess the specific risks facing your business and assist you in finding the ideal coverage solution to meet your unique needs. To find out more information about this important type of coverage, please contact our friendly and knowledgeable Macey’s team today.
This article originally appeared on Macey Insurance Brokers Blog and has been published here with permission.
Advisr does not provide advice and does not hold a financial service license (AFSL). All information above has been provided by Brendan Goddard.