Cyber attacks: The risk you can’t ignore

The Insurance Act 2016, new sentencing guidelines for Health & Safety Offence, and Motor and Liability fraud are just a few of the issues business owners are faced with in 2016.

Sagar

By Simon Whittaker, senior account executive, Sagar Insurances

The one issue that all businesses that have an online presence or use electronic systems to conduct businesses are vulnerable to is a cyber attack.

However, as this is not seen as a tangible risk such as property damage or vehicle damage it is very often overlooked.

It is also certainly the case that a cyber attack is looked upon as something that impacts large corporations such as Sony, Talk Talk, Carphone Warehouse and Samsung rather than commercial business.

Nothing could be further from the truth. Consider the following:

  • Cyber-related losses are now considered the largest recorded offence in the UK, overtaking physical crime. Data is now more valuable to criminals than physical assets.
  • Cyber losses cost the UK economy £27bn per year.
  • The average cost of a cyber breach for a small business is between £75,000 and £310,000.
The internet has revolutionised marketing, communication, data storage and working practices. The dramatic rise in the volume of data being handled, and the ever-changing legislative landscape places businesses at increased risk from claims and from regulatory action. What are the considerations a business should make when considering Cyber Insurance?
  • What data do you hold?
  • Are you aware what the full cost of a breach may be and do you have access to experts that could assist?
  • Reputational risk: news of a leak spreads fast, especially in the age of social media
  • How would your business continue trading without your IT systems?
  • Are you aware of what your existing insurance covers and what the potential overlaps are?