What is Cyber Liability Insurance
Hackers. These are not just dodgy movie characters but real life people, doing real damage to businesses across the globe, including Australia. If you’re thinking your small business down under is of no interest to these criminals, think again. Every business with an online presence is at risk of a cyber attack and with cyber crime claiming 1,000,000 victims per day, it might be time to bite the bullet and get the right cover for your business.
Cyber Liability Insurance covers your business against the expense and legal costs associated with data breaches, which may occur after being hacked or from the theft or from loss of client information (you could even be covered for a data breach when leaving a laptop in a taxi). Expenses include the cost of business interruption, forensic investigation and data recovery, extortion (a fancy word for virtual hostage!) and crisis management costs to salvage your business reputation after a data breach from a cyber attack. The policy also covers the financially crippling costs of defending yourself, mandatory notification costs and other legal costs.
In a nutshell, your customer data is sacred. If you don’t protect it properly, your business may be fed to the wolves.
If you’re still not convinced your business may be at risk, here are the cold hard facts about doing business in today’s technically advanced world:
- Cyber crime costs Australian businesses $4.5 billion annually – yet it remains one of the least insured policy areas.
- ‘Unisys Security Index – Australia, 2011’ revealed that 85% of Australians would stop dealing with an organisation if their data was breached.
- The average cost of a data breach in Australia, from Symantec’s 2011 Cost of Data Breach Study, is $2.16 million.
- No business is safe and in November last year, computer hackers from a Romanian syndicate allegedly accessed the IT systems of 100 small Australian retail outlets and stole credit card details of over 500,000 customers.
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What is included?
- Business interruption costs
- Investigation and data recovery costs
- Fines and penalties
- Extortion costs
- PR and crisis management costs
What is typically NOT covered?
- Replacement equipment
- Property Damage
- Prior known facts/instances
- Intentional Acts
Get the cover that is right for you
Policies available through BizCover you can choose between $50k to $2m
Sit back for a minute and think about this….it might be the first time you have considered the impact on your business if your website was taken offline? Or could your business survive losing face in the community, and the associated losses, of your customer’s personal details being stolen? Each business will require a different amount of cover and this depends on:
- The type of risks to your business and quantifying costs to cover those breaches
- The cover you already have in place
- Cover your suppliers, like cloud data storage suppliers, have in place
Who benefits from this type of Insurance:
- Any business that deals with customer data
- Retailers who use EFTPOS machines
- Companies reliant on IT systems to conduct business.
- Example occupations: Doctors, Lawyers, Accountants, Consultants, Estate Agents, Insurance Brokers etc
Could this happen to you?
Hackers are alive and well and get a thrill out of making business owners sweat. Cyber Liability Insurance can reduce your risks and help you rest easy knowing your business is covered from even the craftiest of criminals.
Here are some claims examples:
A Travel Agency experienced 3 separate data breaches where hackers accessed over 255,000 customers credit card information and passport details. Nearly $2m was paid by the insurer for forensic and legal costs.
The link effect
An online retailer’s website was defaced and included a link to a competing retailers website when hackers gained access to personal information and took control of their website. $800K was paid out for the loss of income, cost to repair the website and defence costs.
A sports drug testing consultant accidentally left his laptop at a sports ground. The results of his tests were time sensitive and as a result of the lost laptop he breached his contract. $70k was paid out for Business Interruption, notification costs for potential medical & PII breach and defence costs. He was able to claim $70,000 for business interruption, notification costs and defence costs for the breach of privacy.
Cyber Security For Small Businesses
With more and more cyber criminals targeting SMEs, how can small businesses protect themselves?