Cyber Security Awareness Month: A reminder For Businesses To Stay Safe

Autumn is already here and so is Cyber Security Awareness Month. What a better time to protect your business from online fraud, especially small and mid-sized businesses as they tend to be the prime targets for cyber-attacks for lacking the resources and protocols that larger companies have. Take some time to understand how cyber security works and how your business can have adequate protection.

According to a recent report by Hiscox, cyber incidents have increased significantly over the past years – from 45% to 61% this year. This is the third year Hiscox releases its Cyber Readiness Report. The report found out that most of the companies surveyed had experienced at least one attack last year. Also, the cost and frequency of attacks have increased when compared to last years’ report.

Some small business owners believe they aren’t vulnerable to this type of attack. While it’s true hackers have historically tracked larger companies, that’s no longer the case. The impact is real. Small to medium-sized businesses are now equally vulnerable to cyber-attack. Mid-sized companies are some of the main targets for cyber-attacks because they lack the resources to protect themselves. For smaller companies, the threatening headlines are enough to wipe them out.

A recent insurer-sponsored survey with 1,200 participating business leaders found out that cybersecurity is the top concern among businesses of all sizes. Unfortunately, only half of the participants surveyed purchased a cyber insurance policy, 47 percent created a business continuity plan in case of a cyber-attack, and 49 percent took a cyber risk assessment on their own.

Although more businesses are taking steps to prevent a cyber incident, it’s quite alarming that approximately half don’t have adequate insurance coverage. Also, cyber risks may be a threat for insurers that don’t offer cyber insurance since these insurers may have to cover the costs of cyber claims on traditional policies. GlobalData shows that insurers not offering cyber coverage could be impacted financially because they must cover the costs of cyber-related claims.

American International Group (AIG) is planning to transition to affirmative cyber insurance to clarify how commercial and casualty insurance policies cover or exclude cyber risks, whether physical or non-physical, and address some of the concerns that some traditional insurance policies are silent about, especially when it comes to cyber coverage. Policies should be clear about the type of coverage they offer. Unfortunately, many Property and Casualty policies aren’t clear about how to adequately deal with cyber exposure. A swift to affirmative cyber coverage can help clients consider the cyber perils they face and assess how that exposure can impact their policy and coverage.

Ensuring you have proper cyber coverage is vital but so is preparing a response plan. A cyber incident can generate many types of loss such as penalties and fines, stolen funds, and much more. As this month is Cybersecurity Awareness Month, make sure you gain some understanding of the different levels of cybersecurity readiness so that you can assess how well your business is protected.