Cyber Insurance Simply Explained

Small businesses are seen as easy targets by cyber criminals, because of this and GDPR fines for data breaches the demand for affordable cyber insurance cover is growing.

To cyber criminals small businesses are seen as ‘low hanging fruit’ waiting to be picked.  Conversely business owners, department heads and managers don’t see themselves as prime targets from cyber attacks.  There lies the problem.

A good cyber insurance policy is there to take the business continuity risk and financial risk out of the equation should there be a data breach in your business.  Use the following analogy to make sense of cyber insurance:

Analogy : Owning and Driving a Car & Owning and Running a Business

  • the driver
  • the MD
 
  • the car
  • the business
 
  • a car has passengers
  • a business has clients
 
  • the car is road worthy because of the MOT
  • the business is client data worthy because of GDPR
 
  • the car has insurance
  • the business has cyber insurance
 

fluid in the car

  • brake fluid
  • engine coolant fluid
  • petrol
 

data in the business

  • employee data
  • client data
  • financial data
 
  • when there is a crash sometimes fluid leaks out
  • when there is a breach sometimes data leaks out
 
  • someone steals you car and you don’t have access to it
  • someone steals your data and you don’t have access to it

It’s on these occasions when cyber insurance becomes important.  We don’t know when breaches will happen but we can prepare for them and protect against them with:

  • staff training
  • anti-virus software installations
  • limited and controlled data access procedures
  • changing security passwords when key employees leave the business
  • cloud computing services
  • personal device policies
  • remote working policies
  • systems audits to identify weaknesses
  • cyber attack action plan
  • only exchanging data with businesses that are aware of GDPR and its importance
  • only exchanging data with businesses that carry cyber insurance cover

The last two may seem unrealistic but in the future who knows! 

Regardless it makes sense to have cyber insurance if:

  • you do business over the internet or mobile networks
  • you are handling or processing a lot of digital data
  • the digital data you hold is the lifeblood of the business

Some standard insurance policies may offer a level of protection but a focused cyber insurance policy is specifically designed to provide your business with financial protection and access to key support services should a cyber attack happen.

We recommend sourcing a local insurance service provider for the best results.

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