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A guide to cyber insurance
While digital transformation has improved business performance across many sectors, the increasing reliance on digital storage and processing of data brings with it potentially devastating risks. In light of this, and despite IT security being a top priority for businesses, it is impossible to pre-empt and protect your business against each and every cyber threat. This is what makes cyber insurance so important. This guide explains why cyber insurance is a key component of a comprehensive IT security strategy and why you may want to consider including it in your business insurance.
What is cyber insurance?
Cyber insurance, also referred to as cyber liability insurance and cyber risk insurance, is designed to provide protection against risks that come with storing and handling data. It covers your business's liability for data breaches involving customer or employee information such as credit card numbers, passwords and personally identifiable information (PII). Situations in which you would make a cyber insurance claim include both accidental and deliberate breaches, such as:
An accidental privacy breach by an employee
A situation involving hacking, extortion or ransomware
Cyber insurance can cover a variety of financial costs, including:
Investigation of the crime
Recovering data which is lost during the breach
Restoring the computer and security systems
Locating and removing any viruses which have been installed within the computer system
Potential loss of income if the business is closed for a period
Costs of managing the business’s reputation
Extortion payments which may be demanded by hackers
Notification costs of third parties
Claims from third parties for damages
Hiring IT professionals to respond to the issue
Hiring professionals to install systems which prevent future incidents
Legal costs of defending your business against a GDPR breach
Benefits of our cyber insurance comparison
Extortion, hacking and ransomware
If you're held ransom by a hacker, or have to pay compensation to your customers because of a data breach, we'll cover damages and extortion payments, as well as costs associated with defending, negotiating and settling the claim.
Cybercrime
We offer an extension that will reimburse up to £100,000 in financial losses caused by funds transfer fraud (social engineering), phone hacking, botnet attack and cryptojacking.
Data protection breaches
If you believe you've suffered a data breach, contact our 24-hour breach response helpline, and we'll provide you with legal, IT security and PR support. We'll also help communicate the breach to affected customers and set up a call centre to assist them.
Business interruption
We'll reimburse income you lose because of a security breach affecting your computer systems - or those of your suppliers. We'll also pay for your data to be restored if it's lost or damaged in the process.
Do I need cyber security insurance?
If you store or process data, regardless of your business's industry or stage of digitisation, the answer is probably that it's something you could benefit from.
Cyber threats aren't static, they're constantly developing alongside the technology they aim to infiltrate. This makes it very difficult for internal IT teams to maintain cyber defence efforts, train employees to recognise signs of a cyberattack, not to mention understand how to deal with an attack or a breach once it's underway.
Cyber insurance is one element of a multi-pronged solution, helping businesses to stay as protected as possible. If your business uses, stores or sends electronic data, it is likely you will need cyber insurance. Any data your business holds is vulnerable to data breaches and cyberattacks, with insurance providing the financial support you may require.
In short, if you hold sensitive data, process payments or rely heavily on IT systems, it is likely you will require specific cyber insurance.
Features of cyber insurance
Extortion, hacking and ransomware
Ransomware attacks are one of the most common cyber threats businesses face. This type of attack involves the installation of malware (malicious software) in your computer systems most commonly through phishing - resulting in an employee accidentally downloading the malware from an email link or attachment - or through methods that exploit security holes without bypassing a user - with the objective of encrypting of exfiltrating your data and holding it for ransom.
Simply removing the malware from your system will not recover the affected data. If you want to get back your data, you will need to negotiate and pay the hacker - usually in cryptocurrency. This is where cyber insurance comes in. A cyber insurance policy will not only give you investigatory support, but will also provide you with access to expert negotiators to deal with the situation on your behalf and take care of the ransom.
Data breaches
Data breaches can be tricky to detect, but having cyber insurance gives you access to a 24-hour breach response helpline and investigators who can take a look at things even if you only have a slight suspicion that something may have happened. If a breach is detected, you'll also gain access to legal, IT security and PR support to communicate the breach to affected customers and mitigate reputational damage, as well as cover for legal and defence costs in relation to the breach.
If a data breach results in a regulatory penalty which is deemed insurable by law, cyber insurance may cover this. These fines can be devastating to businesses, with PCI fines ranging from £3,000 to £60,000 and a GDPR fine which has the potential to be as high as €20 million (about £18 million) or 4% of annual global turnover.
Lost income
What would happen if your computer systems were to be down for a week, or two weeks? For many businesses, this situation would be disastrous. If your income is interrupted due to a breach affecting your computer systems - or those of your suppliers - for example, a Distributed Denial-of-Service (DDoS) attack, cyber insurance can not only cover you for the cost of DOSarrest to fix this, but may also reimburse lost income. It'll also cover the cost of restoring your data, if it has been lost or damaged in the process.
Cybercrime
Superscript offers an extension that will reimburse up to £100,000 in financial losses caused by funds transfer fraud (social engineering), phone hacking, botnet attack and cryptojacking.
How do I protect my business from cyber crime?
While cyber insurance is an important component of your IT security programme, much can be said for following basic principles of IT security. In fact, the majority of cyber breaches arise from simple accidents, such as sending an email to the wrong person, or a work laptop going astray.
Although these incidents are not completely avoidable there are basic steps you can take, as a business, to make them less likely and to minimise the impact.
1. Carry out a risk assessment
A cyber risk assessment is an important starting point to help you identify your areas of vulnerability. Start by auditing the data and information you hold that is most valuable. This will give you a good idea of where you need protection. Then look at how you store this data, who has access to it and how it's protected, to assess the need for any additional security measures.
2. Employee training
Malicious or not, human error is the most common reason for cyber-attacks and data breaches. A breach can be caused by anything from an employee accidentally sending sensitive information to the wrong email, to losing their company phone. Yet despite the risks, businesses often fail to mitigate against breaches of this kind. While many cyber threats are sophisticated, many are less sophisticated - a poorly worded email, or a strangely personal request from a distant friend or colleague. The National Cyber Security Centre website hosts a wealth of useful content for small and medium-sized businesses.
3. Build a security centric workplace
It's easy to overlook the fact that seemingly innocuous data could actually cause your business major problems. You're responsible for the data you collect in all environments too, so it's important to consider the implications and measures that need to be put in place if employees take their laptops outside the office environment for example, or how they access work files remotely. Additionally, many businesses aren't fully aware of the amount of information that their vendors have access to and this can also pose a serious security risk. Checking a vendor's security controls should form part of the vetting and onboarding process.
How much does cyber cover cost?
There are many cyber insurance companies available, which provide a range of policies offering cyber liability coverage. The actual cyber liability insurance cost will depend on a variety of factors, such as:
The type of business you operate
The risk of potential cyber attacks or data breaches
The businesses annual turnover
The type of data your business holds, how it is stored and used
The level of network security you have in place
The industry sector which you trade in
If your business holds confidential data, it is likely your cyber attack insurance will be more expensive than low risk businesses. For example, if your business operates in the financial industry you will be at greater risk of an attack. Whether an attacker hacks into your system and steals your data or you accidentally expose confidential information, insurance will provide cover.
Holding adequate insurance will provide cover for any damage to your business and any other individuals which are affected.
How do I find the cheapest cyber protection quote?
We have partnered with leading cyber insurance providers to help your business find the best insurance at the lowest price.
We can help you find the cyber liability insurance coverage your business requires from the cheapest provider available.
Our panel of trusted insurance suppliers includes AXA, Aviva, NIG, Hiscox and more. These cyber insurance providers can offer cover for amounts specific to your business requirements; with the features you require.
To find the cheapest quote for your business, start by entering your details into our convenient online form.
All we need are a few key details such as the type of business you run, your turnover and the excess you are willing to pay. If your business does not fit the usual mould, we will still do our best to find you the insurance you require.
Simply give our dedicated insurance team a quick call and we will negotiate bespoke quotes for your business.
You will then be able to compare the available options to find the best cyber insurance for your business at the cheapest price.
If you decide to go ahead, we will help guide you through the process of obtaining your policy.
Whether you choose to pay the full premium or split the cost over monthly payments, the whole process is designed to be quick and simple.
Compare cyber insurance today!
If you are searching for cyber insurance small business coverage or cyber security insurance providers specialising in large corporations, we can help. To find out more about cyber insurance or any other form of business insurance, please contact our team today.
Whether you are searching for home business insurance or business insurance, we can help you find the best deal. To find out more about arranging the best price for general liability insurance for small businesses, please contact our team today.