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Protect Your Business Against Cyber Crime
According to recent police statistics more than £190,000 a day is lost in the UK alone by victims of cyber crime. Figures show 13,557 reported cyber crimes, 5,000 of which came from social media account email addresses that had been hacked. The effect of this cost businesses £14.8 million in the UK.
Cyber crime is on the rise and with that in mind, does your business have the right insurance to protect itself against hackers, loss of earnings and the effects of reputation damage?
Most common types of Cyber Insurance Claim
Cyber attacks can hit a business in many forms; Denial of Service Attack, Ransomware, Phishing, Social Engineering. Below is a brief description of each:
Denial of Service Attack
A denial-of-service (DoS) attack is one of the most powerful weapons used on the internet to disable websites and online services. The aim is to overwhelm the target with more traffic than the server or network can accommodate rendering the website or service inoperable.
Ransomware is when a computer is maliciously infected with malware to disable access to files or stop computers, electronics or other machinery from functioning unless a ransom is paid. It can be spread through emails, social media or a connected device and can have a catastrophic effect on the business Hackers will often threaten to publish sensitive data which has been extracted from the network as well. The most recent example of this is WannaCry cyber-attack which cost the NHS £92m when systems were temporarily disabled.
Phishing is a tactic criminals use by sending fake emails that look like they are from an individual or company you are familiar with to extort money from you. They will ask you to transfer money to them, they can even send invoices that look genuine. Businesses can lose thousands from inadvertently paying rogue invoices.
Social Engineering involves the use of deception to manipulate individuals into transferring money, handing out personal information or convincing an individual to access a link. According to the FBI, between October 2013 and May 2018 £12.5 Billion was lost worldwide due to a type of social engineering.
Do I have exposure to Cyber-Attacks?
If the answer to any one of the below questions is yes, then you have an exposure to cyber-attacks and should consider holding a Cyber Insurance Policy:
- Do you send wire payments?
- Do you store clients personal details?
- Do you store critical information on computers for the day to day running of your business?
- Do any employees work remotely?
- Does the business rely on a website or internet sales
A cyber-attack will never happen to me, my business is too small.
A common reason for small or medium businesses not holding Cyber Insurance is that they are too small to be targeted however cyber criminals are indiscriminate in their approach and often don’t know who they are attacking, only that they are attacking weak systems or networks with vulnerabilities.
I use a third-party IT company, my network is secure and I have virus protection.
Another common misconception is that you may be protected due to having a third party IT contractor, and whilst outsourcing services does provide added protection what happens if the security of your IT provider is compromised? A trend is now developing where cyber criminals will target technology companies in order to extract information and access their clients systems.
Could your business survive a Cyber-Attack?
How long can a business really survive without access to their computer systems? A common claim example, an online retailer loses their systems to Ransomware with no way of making sales to their customers. How long could your business survive without making a sale? a couple of days? a week? The hacker also threatens to release client information which could potentially affect any future sales if the customer base loses trust in the website.
This is where Cyber Insurance can help. When a claim is reported to a cyber insurer they are there to support you 24/7 through the ordeal. Many of the insurers have their own in house IT experts to work alongside your existing IT team or take over from them completely to resolve any technical issue that has arisen from a cyber-attack.
An insurer can provide specialist knowledge on how the attack occurred and what changes need to be made to prevent against further cyber-attack, and, if necessary, negotiate any demand for ransom using specialist response staff.
Once the imminent threat has been resolved and the policyholder system and data are secure a Cyber Insurance Policy can cover the loss of profit from the event until the business is fully operational. This can be offered on a 3,6 and even 12 month indemnity period.
What if the cyber-attack crippled your systems and you had to notify your customers or even worse became public knowledge? How would a business deal with the negative attention or loss of customers as a result?
TalkTalk had a huge data breach where customers card/personal details were stolen. The damage done to their reputation had a significant impact on them taking new customers and retaining existing. With reputation harm cover included on a cyber policy this can reimburse lost profits until the business can restore its reputation and return to a level that they were trading at prior to the cyber-attack.
Cyber Insurance is a necessity for any business but unfortunately only 10% of businesses in the UK have Cyber Insurance which is astonishing given the exposure the majority of businesses have.
With Premiums starting from as little as £400.00 per year can your business afford not have insurance in place to a cyber-attack or data breach?
If you would like further information on the benefits of having Cyber Insurance, please contact us to discuss and arrange a no obligation quotation from one of our advisers. Insurers can provide indications based on a limited amount of information with options to tailor the coverage to your specific needs.
Written by Ashley Collins. Tel: 01732 252 894 Email: Acollins@clarkewilliams.co.uk
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Clarke Williams Ltd are authorised and regulated by the Financial Conduct Authority under reference 758683. The Financial Conduct Authority’s Register can be accessed through http://www.fca.org.uk/ . We are registered in England and Wales with Companies House under number 10317065. Our registered office address is 194 High Street, Tonbridge, Kent, TN9 1BE