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What is cyber insurance and who needs it?

If your business activities involve doing anything on the internet such as sending and receiving emails or using social media to promote your business, then your business has some exposure to cyber crime.

However, if your business has an e-commerce website, keeps client records with sensitive data or emails invoices, your business is even more exposed to cyber crime and the cyber criminals are getting craftier and craftier every day. Imagine coming to work one day and turning your computer on only to find a locked screen with a message to pay a ransom in bitcoin to unlock your computer. This is where cyber insurance can help.

Here is the breakdown of cyber liability insurance:

1.      Access to a 24/7 incident response
Most cyber insurance policies provide you with access to a team of IT experts at any time for an immediate response, which is really important because when your business has been attacked it is vital that you secure your data to prevent further damage to your business. A quick response can save you a lot of money and greatly reduce any damage to the reputation of your business. Of course, after the initial response the IT experts can guide you for the next steps.

2.      Mitigation
Just by going through the process of setting up a cyber insurance policy tailored for your business you may be provided with important tips and information to enhance your IT security to reduce the likelihood of a cyber attack on your business. Good cyber security includes using antivirus software, firewalls, updating browsers, software and passwords regularly, using strong passwords, avoiding clicking on suspicious links, using multifactor authentication, and educating your employees about cyber threats.

3.      What is covered by cyber insurance?
The consequences of a cyber incident can be very costly. As a result cyber Insurance provides cover for a large number of potential costs to your business. Depending on the situation, you may be up for the cost of ransoms or IT solutions to unlock and repair your systems. You could also be liable for the costs of reporting the breach, legal claims, and remediating any losses suffered by your customers or clients. 

Cyber insurance can cover loss of revenue due to interrupted business, hiring negotiators and paying ransom, recovering or replacing your records or data, liability and loss of data you hold about others (e.g. customers), legal advice and defence costs, misuse of intellectual property online, data restoration, customer notification, costs associated with an investigation by a government regulator and indemnification of government fines and penalties, and claims against your business for privacy breach.

4.      Most common types of cyber attacks

Management Liability insurance is designed to provide protection to both the business and its directors or officers for claims of wrongful acts in the management of the business.

A business insurance pack can provide cover for your business premises and contents, against loss, damage, theft or financial loss from an insured interruption to the business.

Purchase up to six products under one Business Insurance Package. 

4.      Most common types of cyber attacks
  • Malware attack is one of the most common types of cyber attacks. Malware means malicious software viruses and includes worms, spyware, ransomware, adware and trojans. 

  • Phishing attack is also a very common type of cyber attack where the attacker impersonates a trusted source and sends the victim a fake email with a malicious link or attachment. 

  • Password attack is where the hacker cracks your password with various password cracking software such as Aircrack, Cain, Abel, John the Ripper, Hashcat etc. It is more difficult for these software programs to crack strong alphanumeric passwords with special characters. 

  • Man-in-the-middle attack refers to when an attacker intervenes in between a two-party communication and steals data, which can happen when using public Wi-Fi networks and unsecure websites. 

There are many more types of cyber attacks including denial of service attack, SQL injection attack, URL interpretation, DNS spoofing, web attack, insider threats, drive-by attack, XSS attack etc.

General Advice Warning: This advice is general and does not take into account your objectives, financial situation or needs. You should consider whether the advice is appropriate for you and your personal circumstances. Before you make any decision about whether to acquire a certain product, you should obtain and read the relevant product disclosure statement.

All information above has been provided by the author.

Craig Muldoon, Stress Free Insurance, ABN 68655178377, AFSL Community Broker Network

This article originally appeared on Stress Free Insurance Blog and has been published here with permission.

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