Cyberattacks are not just an issue for larger organisations, because in recent years, we’ve seen an increasing number of smaller businesses targeted too.
They’re also proving more costly. Having risen by a staggering 40% in just four years,[1] cyberattacks are now thought to cost UK businesses a huge £21bn per year.[2]
While no company is invulnerable to a cyberattack, SMEs, who have fewer resources than larger companies to tackle such threats, are particularly common targets.
In fact, a recent survey found that 39% of UK small businesses have suffered a cyberattack,[3] with the average cost of a breach as much as £3,000.[4]
What are some of the common forms of cyberattacks
One of the difficulties of safeguarding against cyberattacks is that they come in many forms. Below are just a few of the most prevalent cyber threats businesses face today and ones we should all keep an eye on:
- Ransomware attacks. These occur when an attacker gains access to your company’s data and threatens to encrypt or delete it unless a ransom is paid.
- This works by infecting your computer, often allowing hackers to access your private servers, in turn disrupting your business.
- Phishing is a type of scam whereby fraudulent emails that claim to be legitimate are sent to employees with the aim of getting the recipient to click a link, or share confidential details.
- Denial-of-Service (DoS) attacks usually work by overloading your network with false requests so that you are unable to conduct business as usual. Well-executed DoS attacks can be very time-consuming and expensive for businesses.
Vigilance only goes so far
It’s also worth remembering that cyberattackers don’t just target SMEs. Anyone can be a victim, from small companies to big companies and corporate monoliths.
Importantly, cyberattacks do happen even when workforces are given adequate training on how to prevent a cyber breach from occurring in the first place.
That’s because cyberattacks only get more sophisticated as time goes on, as criminals learn and adapt their strategy with experience. Businesses can take preventative measures, but only to a certain extent; and remember you could have the most robust cyber protection measures available on the market and still experience a cyberattack.
Cyber liability insurance and what SMEs should look for in a cyber insurance policy
Cyber liability insurance is a crucial element in any post-cyberattack rebound and recovery plan. It can cover you in a range of areas including, damages and compensation, data restoration, damaged equipment, legal fees, crisis management, and much more.
Cyber liability insurance can’t stop cyberattacks – but it can help protect your business and provide support should you suffer a breach.
There are five key factors you should consider when it comes to choosing a cyber insurance policy.
- When it comes to cyber insurance, there’s no such thing as a one-size-fits-all policy, so make sure you’re covered for the risks that are relevant to your business.
- Limit of indemnity. This is the maximum amount the insurance company will pay out in the event of a claim. You’ll therefore want to make sure you’re happy with the proposed limit.
- Some policies may exclude losses resulting from the actions of employees or lack of adequate security measures.
- Policy details. Get familiar with the small print and make sure you understand your policy’s terms and conditions, including claims process, notification requirements, and sub-limits.
- The cheapest policies aren’t necessarily the best, but this is especially true when it comes to protecting against cyberattacks, which can come at a debilitating cost to businesses. It’s therefore important that you make sure you strike the right balance between cost and coverage.
If you have a question or query about anything we have discussed or want to know more? Get in touch with Edwards Insurance Brokers on enquiries@edwardsinsurance.co.uk or 01564 730900.
[1] Report: Insider Cybersecurity Threats Have Jumped 40% in 4 Years (tech.co)
[2] Detica_Cybercrime_Summary_AW.indd (publishing.service.gov.uk)
[3] Businesses urged to boost cyber standards as new data reveals nearly a third of firms suffering cyber attacks hit every week – GOV.UK (www.gov.uk)