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Cyber Insurance

Could Your Business Recover From a Cyber Incident?

The risk and related costs of a cyber incident to an SME are ever-increasing. Insurance companies and brokers, like us, are working very hard to raise awareness of cyber risks, so businesses can be protected.

SMEs are being lulled into a false sense of security by the lack of media reporting on cyber incidents affecting small and medium businesses. Only the big names, the big fines and the big data breaches make it into the press. The reality is that SMEs are much more likely to suffer a cyber attack or data breach, because their cyber security is more vulnerable!

The costs of recovering from a cyber incident will vary but here we'll explain that it's not just the cost of fixing a computer!

What Is a Cyber Incident?

    Just under half (46%) of all businesses identified at least one breach or attack in the last year.
    Cyber Security Breaches Survey 2017

A cyber incident could be anything from a deliberate cyber attack to an unintentional data breach by an employee. Hover on these examples for more information about them.


System Failure
 
Cyber Extortion
 
Data Breach
 

Malware
 
Cyber Crime
 
Data Loss
 


    The most common types of breaches related to staff receiving fraudulent emails (72% of those who identified a breach or attack), followed by viruses and malware (33%), people impersonating the organisation online (27%) and ransomware (17%).
    Cyber Security Breaches Survey 2017

Depending on the incident itself, below are some of the costs associated with a cyber incident and data breach.

Cyber Costs

Claims Examples

Claims Examples

What Is Cyber Insurance?

Cyber insurance is designed to cover the cyber risks that businesses face.

    "Most businesses these days now have a much greater reliance on their digital assets than they do on their physical ones, which makes a new kind of policy essential."
    CFC Underwriting

While cyber insurance can't prevent the incidents described earlier, it can protect a business from the associated costs.


    Key features of cyber cover*

    Incident Response
         		 Some insurers will provide support with the entire incident, including IT specialists, legal support, PR support, credit and ID monitoring, and more.
    System Interruption
         		 The insurer will pay for mitigation costs to minimise the disruption of the business operation, including repair of IT systems and programmes.
     
    Cyber Crime
         		 If a hacker steals money from the business's account the insurer will cover it. Ransoms paid in the event of a denial of service attack can also be covered.
     
    Business Interruption
         		 The insurer will pay for increased cost or working and loss of income.
     
    Loss of Data
         		 The insurer will cover the costs of restoring data.
     
    Third Party Liability
         		 The insurer will pay compensation to third parties who suffered a loss resulting from the business''s data breach or inadvertent transmission of a virus.
     
    Fines and Penalties
    (where legal)
         		 The insurer will pay ICO or PCI fines and penalties, where it is legal to do so.
     
    Legal, IT, PR and other expenses
         		 Defence costs, reputational harm mitigation costs, additional call centre staff costs, customer credit and ID monitoring support, and more.
     

*Not all of these covers are offered by all insurers. Policy terms and covers offered will vary.

Conditions of Cover

An insurer is unlikely to offer cover, or a claim could be unsuccessful, if a business's IT security and data privacy procedures are seriously lacking. It may also be a policy condition to have a disaster recovery plan in place.

cyber essentials At quotation stage, many insurers ask if the business is Cyber Essentials accredited. Cyber Essentials is a government and industry supported scheme to help businesses protect themselves against cyber risks as well as demonstrating to their customers that they take cyber security and the protection of their data seriously. More information can be found at www.cyberessentials.ncsc.gov.uk However, strong cyber security isn't enough to fully protect a business. If a hacker is determined enough or if an employee makes a simple mistake, a cyber incident can occur.

Cyber Protection

With strong cyber security and the right cyber insurance in place, business owners can feel confident that they have done everything they can to protect their business, staff and customers from the effects of a cyber incident.

Who Needs Cyber Insurance?

All businesses which use IT in some way, are at risk of a cyber attack or data breach. SMEs are often an easier target for hackers than big corporate companies as their security is weaker. Even with strong cyber security, a determined hacker will find a way or an employee error could result in disruption and financial loss.

How much does it cost?

Cyber insurance premiums vary according to these main rating factors:

  • Business description
  • Turnover
  • Number of Employees
  • IT Security
  • Claims and cyber incident history

    At Philip Gibbs Insurance Brokers, we discuss the needs of our clients in detail so we can identify the most suitable policy for them.

    For a free consultation and assessment of your business cyber risk, contact our experienced team.

    t: 023 9267 1133
        or    
    e: info@pgib.co.uk