Cyber Insurance; does your business need it?
Paul Baldwin
Chartered Insurance Broker | Director of Cass-Stephens Insurances, Gloucester
Recent events have clearly shown that cyber security has become a key risk to businesses of all sizes and that risk is increasing.
According to the Department for Business, Innovation & Skills’ survey in June 2015 74% of small businesses have experienced a security breach in the last 12 months.
Threats associated with cyber-attacks and data loss can include:
- Loss of hardware
- System interruption by viruses, trojans and other malware
- Phishing
- Network failure
- Cyber extortion
- Deliberate actions of discontent employees or former employees
- Negligent employees opening an infected email or clicking on a malicious link
In addition to the damage to your own hardware, data and the ability of your business to trade, you could be found liable should a customer’s or supplier’s system be infected with a virus originating from your business or if sensitive date that you hold is accessed.
Your business could be at risk if you:
- hold on your systems sensitive customer data such as names and addresses, credit card details or banking information
- are dependent on computer systems to conduct your business
- have a payment card merchant services agreement
- provide e-commerce services
- or simply just have a website
If any of the above apply to you and your business, then you really should speak to your insurance broker (or me!) about Cyber Insurance
Chartered Insurance Broker | Director of Cass-Stephens Insurances, Gloucester
8yDanny on a decent policy it isn't the case that the "package is the package". You can elect to insure against damage to your hardware, data corruption, cyber crime, cyber liability, etc. The insurance should fit the client's needs, not the other way round. And yes, some providers do seem to major on the after-the-event get in the PR people approach. But not all do...the main risk for many businesses is, as you rightly say, financial Simon - yes I agree - risk management first, insurance second Jill - thanks for your comments and support. Don't worry about the "broker-bashing" as it seems to be helping this post get quite a few views :-)
Charity & Church Insurance Broking & Advisory - CEO @ Access Insurance Services - a Benefact Group Company. Charities.network
8yAgree with you Danny - the first thing we should ask is where they are at with their cyber programme - have they looked at Cyber Essentials or CE plus for instance. If we don't do this clients could simply assume that the insurance cover is there to cover them when as you rightly say they could be utilising this money for the "burglar alarm" first line of defence cyber protection. We are happy to work with our clients on this and have alongside government advice on cyber security, an in-depth risk management policy for clients to implement. If after they have done and considered these aspects then we will move on to explaining the insurance angle.
Chartered Insurance Broker
8yDisregarding your final point Danny which has nothing to do with this topic or my previous example, we do all seem to be in agreement that it is important to identify the risks, work out how to remove or reduce those we can, then either accept or insure what is left. It's what a professional insurance broker does all day every day and as I stated at the beginning our challenge is to engage our clients in the concept that they probably have a problem in this area. Unfortunately as the topic Paul started has degenerated into 'broker bashing' it is likely the large majority of non-insurance linked in members will have lost interest long ago.
Chartered Insurance Broker
8yWell said Paul. The challenge for the insurance broking community is to raise the profile of these risks with our clients before something bad happens to them (or they find out it already has). Yes Danny, system security is important but most businesses still buy theft insurance even though they have a burglar alarm and the policies you mention may include an element of third party cover but not first party losses.
Chartered Insurance Broker | Director of Cass-Stephens Insurances, Gloucester
8yThank you for your input Danny. Hope you enjoyed the “blurb”. You will have no doubt noticed that I, unlike another contributor, have not mentioned the cover details at all in my article. This is deliberate as the need of each company is different depending on what they do, the nature of their systems, how they use social media, the training of their staff, the system security they have in place and of course what insurance policies they already hold. Insurance is, as you are well aware, just part of the overall risk management process.