Today, businesses of all sizes have some exposure to cyber-crime. In fact, figures suggest that almost half of small businesses suffered a cyber-attack or breach in the previous 12 months.
Being victim of a cyber-attack can cause significant disruption to your business. It can also have a substantial financial impact. Imagine if you are unable to operate due to system or network damage caused by an attack. Or face regulatory scrutiny and fines for a data loss.
Yet it is thought that as many as 89% of UK businesses do not currently have a specific cyber liability insurance policy in place.
If your business doesn’t currently have a cyber liability insurance policy in place, you could be leaving yourself vulnerable if your business does become the target of a cyber-attack.
What is cyber liability insurance?
Cyber liability insurance is an insurance product designed to offer protection for your business IT systems and networks – specifically damage to or loss of data. For example, if you suffer a date breach or a cyber hack or attack.
The ABI recently revealed that, for ABI member cyber insurance policies, 99% of the claims made in 2018 were accepted and paid out. Yet take up of the cover is still very low.
What types of risk does cyber liability insurance cover?
Cyber insurance will typically provide cover for the financial impacts of a cyber-attack such as business downtime, system damage and reputational impact. It also aims to provide you with support and assistance in dealing with a cyber-attack. It can be reassuring to know you aren’t alone if the worst should happen.
Whilst all cyber liability insurance policies will vary, the types of risks that they can provide cover for include areas such as:
- The costs of undertaking investigations into causes of the attack as well as identifying where fixes are required to restore security
- Costs associated with providing legal and communications services following an attack or breach.
- If your business is held to ransom, cyber insurance can cover the ransom costs as well as support in managing the situation
- Business interruption associated with the effects of a cyber attack
- Reputational damage and assistance with crisis containment
- Cover to repair damage caused to your systems by a cyber hack
- Costs of regulatory investigations which may arise from data losses
- Compensation claims which may arise from customer data loss
Does my business need cyber liability insurance?
At Anthony Jones, we encourage all of our customers who rely on IT systems and store data to protect their business with cyber liability insurance.
But you should certainly consider taking out a policy if your business:
- Holds sensitive customer data – names, addresses etc
- Processes card payments
- Use IT systems to run your business
- Have a website upon which you rely for business success
Don’t think that just because you operate a small business you are not at risk of cyber-crime. Figures suggest that in fact, small businesses are increasingly being targeted by cyber criminals.
Why is cyber liability insurance so important?
The risk of cyber-crime isn’t one that is going away. The types of cyber-attack launched become more sophisticated every day. And with businesses of all sizes at risk it isn’t something that your business should overlook.
Cyber crime is big business. With that comes a high cost to businesses who fall victim to the cyber criminals. Government figures suggest the average cost of a cyber breach is £65k-£115k for SME’s. Could your business cover such high costs and still maintain your business operations? The impact could be even more significant if coupled with reputational damage or customers going elsewhere if you suffer business interruption.
Cyber insurance can provide a valuable safety net in the event that a cyber incident does occur.
The ABI offer a comprehensive guide to cyber liability insurance for SME’s which may be worth referring to if you are considering cover for your business. Alternatively, you can talk to us at Anthony Jones about your needs. We work hard with all of our customers to understand their business and insurance needs so that an adequate level of cyber liability insurance cover can be put in place to protect you if an attack should happen. Contact us today on 0208 290 9080 or email us at cyber@anthonyjones.com.
