I’m a Small Business, I don’t need Cyber Insurance
Contributed by Idea Collective Member:
Did you know that ransomware attacks are up 235% in 2021 and ransomware payments increased by 370%.
Is your business ready?
High-profile cyber-attacks on companies such as Target and Sears have raised awareness of the growing threat of cybercrime. Typically, business owners don’t see themselves as large as Target or Sears and therefore they are not prone to attacks. Unfortunately, small business owners are operating under a false sense of cyber security.
Between supply chain issues, reduction in work forces, remote employees and being stretched too thin, cyber criminals are in the land of opportunity. Businesses with little to no cybersecurity measures are ideal targets.
Time is often the one-word business owners say they need more of. A cyber-attack has a domino effect. Imagine your business being at a complete halt because of a click of a button, the first domino to fall and create a chain reaction.
What is the adage? An ounce of prevention is worth a pound of cure.
We need to plan for the reality of a cyber-attack through systems, processes, training, check lists and cyber insurance policies. Most small businesses lack a formal internet security policy for employees, and only about half have rudimentary cyber security measures in place.
Furthermore, only about a quarter of small business owners have had an outside party test their computer systems to ensure they are hacker proof, and nearly 40% do not have their data backed up in more than one location.
We have work to do and dreams to protect. Right now is the best time to get your business cyber ready.
Don’t Equate Small with Safe
Despite significant cyber security exposures, 85% of small business owners believe their company is safe from hackers, viruses, malware or a data breach. This disconnect is largely due to the widespread belief that small businesses are unlikely targets for cyber-attacks. Just as water flows through the easiest path, so do cyber criminals.
Data thieves are simply looking for the path of least resistance. 60% of attacks are against small and medium sized organizations. Outside sources like hackers aren’t the only way your company can be attacked—often, smaller companies have a family-like atmosphere and put too much trust in their employees. This can lead to complacency, which is exactly what a disgruntled or recently fired employee needs to execute an attack on the business.
As we are reviewing insurance policies, the two areas underwriters are looking for are: Do you use two set authentications on your computer systems? And are you using a two-step check and balance with your companies’ finances.
If the answer is no to either, you will not qualify for the insurance and therefore 100% be self-insured with your business (and possibly personal) finances.
It is very likely Cyber Attacks Could Destroy Your Business
As large companies continue to get serious about data security, small businesses are becoming increasingly attractive targets—and the results are often devastating for small business owners.
According to a recent study by the Ponemon Institute, the average annual cost of cyber-attacks for small and medium-sized businesses is over $4 million. Most small businesses don’t have that kind of financial reserve lying around, and as a result, nearly 60% of small businesses victimized by a cyber-attack close permanently within six months of the attack. Many of these businesses put off making necessary improvements to their cyber security protocols until it was too late because they fear the costs would be prohibitive.
10 Ways to Prevent Cyber Attacks
Even if you don’t currently have the resources to bring in an outside expert to test your computer systems and make security recommendations, there are simple, economical steps you can take to reduce your risk of falling victim to a costly cyber attack:
- Train employees in cyber security principles and how to identify suspicious content.
- Install, use and regularly update antivirus and antispyware software on every computer used in your business.
- Use a firewall and VPN for your internet connection.
- Download and install software updates for your operating systems and applications as they become available.
- Make backup copies of important business data and information, store in multiple places including cloud based.
- Control physical access to your computers and network components with passwords that change at least every 30 days.
- Secure your Wi-Fi networks. If you have a Wi-Fi network for your workplace, make sure it is secure and hidden.
- Require individual user accounts for each employee. Do not share passwords or accounts.
- Limit employee access to data and information, and limit authority to install software.
- Regularly change passwords and enable the Multi-function Authentication (usually under the settings tab).
In addition to the listed tips, the Chubb Insurance offers a Cyber Risk Calculators based on your industry and revenue size. Hackers attack every 39 seconds which is nearly 2,244 a day. Be prepared, protect your business, plan ahead, respond quickly and implement best practices.
Cyber Insurance is a vital piece to your Business Insurance
A data breach could cripple your business, costing you thousands or millions of dollars in lost sales and/or damages. Implement the necessary tools to ensure you have the proper coverage to protect your company against losses from cyber-attacks. Reach out for additional cyber risk management guidance and insurance solutions.
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Insurance Agent, OSHA Outreach Trainer
As a 4th generation insurance agent, you can say I was born into it! As a small child, my parents gifted my brother and I an Apple IIe. Together we coded and figured that machine out. Next, our family was one of the first in our town to have AOL, remember that sound? I guess you could say I am an early adopter. Insurance is complex, and not knowing what you don’t know won’t end well for you. Let’s design some insurance strategies for you!