Cybercrime is a major concern for all types of businesses, irrespective of their size, industry, and location. In 2021, more than 400,000 cybercrime events were reported in the UK alone, and the losses amounted to £2 billion.
The effects of cybercrime and online threats can be mitigated by taking out a cyber risk insurance policy that protects your business against the consequences of online security breaches. In this article we’ll look at how this type of insurance can protect and benefit your business.
What is commercial cyber insurance?
Cyber insurance can help your organisation recover from internet-related crimes. For example, your IT equipment could be subject to ransomware attacks, or you could experience data breaches affecting your customers or your company.
If this happens, cyber insurance will cover legal fees, the cost of forensics, data restoration and any unauthorised transactions carried out by cyber criminals.
What does cyber insurance cover?
In addition to the above, commercial cyber insurance offers compensation for the following:
- Expenses (to your business, employees, suppliers, or customers) resulting from identity theft.
- Expenses arising from cyberbullying of an employee by a third party or someone within your organisation, such as the costs involved in addressing character defamation and harassment.
- Consequential losses caused by not being able to meet your financial obligations if you lose access to your bank accounts and miss a payment during a cyber incident.
- Expenses arising from copyright or trademark infringement.
What you can do to further protect your organisation
Having cyber insurance can minimise the disruption caused by security breaches, but it does not prevent them from happening. There are certain preventative measures you can take to further protect your business. These include:
- Assess your current risk level and identify vulnerabilities. You can do this through your in-house IT department or by outsourcing the task.
- Ensure your IT security software is always up to date.
- Train your staff so they’re able to use computers and other devices without exposing the company or its clients to cyber criminals.
- Ensure each employee has a dedicated user account with the appropriate permission levels for better incident traceability.
- Have a data backup strategy.
- Keep payment processing activities separate from general Internet use, for example by using different computers for each task.
- You may want to consider getting certified by the UK’s Cyber Essentials scheme.
Benefits of cyber insurance
Having cyber insurance can protect your business in the event you suffer data breaches. This type of insurance will help recover the costs involved in cyber extortion defence, forensic and legal support, and assist with any loss of income or profit stemming from business interruption.
Cyber insurance offers extensive coverage that goes beyond a general liability policy. To find out what level of cover you need, you can speak to our Insurance broker, ManningUK